1

PANDORA

Team - Tablets!Mrikondu Barkakati Chithroobeni Shankar Yufei Shi Yixin Zhao!

2

AGENDA

1. Background!

2. Prognosis Criteria!

! - Market Trends!

- Financial Health!

- Internal & External Factors!

- Strategy!

3. Recommendations

3

BACKGROUND

240M+ Users!4 Billion Market Cap!77% Market Share!

2014

2011!At IPO

100M+ Users

2000

Founded!

4

BACKGROUND

Enrich people's life by enabling them to ENJOY music they know !and discover new MUSIC they will LOVE

Revenue & Distribution

- Individuals and businesses!- Free & Subscription Model $4.99!- Revenue from ads & subscription

Mission

5

PROGNOSIS CRITERIA

Financial HealthMarket Trends StrategyInternal & External !Factors

6

MARKET TRENDS

Internet Radio Digital Ads!- S&P predicts positive feature.

!- Forbes predicts $11 billion mobile ads revenue in 2016.

7

FINANCIAL HEALTH

-125

0

125

250

375

500

Jan 2011 Jan 2012 Jan 2013

RevenuesCOGsNet Income

Cost Breakup

23%

4%

64%

9%

G&A COGs Product Development Sales

Gross margin = 40%

8

FINANCIAL HEALTHPandora Media Inc. NYSE: P

0

6.5

13

19.5

26

June 2012 June 2013 June 2014

Market CAP = 4B

Royalty Rates By CRB vs ad RPMs

0

15

30

45

60

2012 2013 2014 2015

Cost per song for Free listenerTotal ad RPMs

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INTERNAL FACTORS Strengths Weaknesses

- Music Genome Project!

- Large and Growing User Base!

- Brand and Reputation!

- Multiple platforms!

- Targeted Ads!

- Pandora for business

- Licensing Restrictions!

- Low Customer Retention

10

Opportunities Threats

- Large potential market size!

- Technological Advances!

- Increasing cost of content!

- Competition!

- Macro-economic Factors

EXTERNAL FACTORS

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STRATEGY

Increase!expenditure !on product !

development!

Expand across devices and platforms!

Try to reduce content

acquisition costs!

Focus on !improving

mobile & ad platform

12

PROGNOSIS-STATEMENT

Although Pandora will not make significant profits, it will still remain the leading player in

the internet radio market.

13

RECOMMENDATIONS

- Content acquisition!

Reduce Cost- International market!- Music inventory!- Non-music domains!

Expand MarketProduct Development- Customization!- Feature Parity!

14

CONCLUSION

In 2016, Pandora will remain the leading player in the internet radio industry.