SiriusXM will acquire Pandora in an all stock transaction valued at $3.5 billion. The combined companies create what they are calling the world's largest audio entertainment company" with $7 billion in expected 2018 revenue.
SiriusXM has been interested in Pandora for more than a year. Last summer, the satellite broadcaster invested $480 million in cash in Pandora in exchange for a 19% stake.
SiriusXM is the leader in subscription radio and Pandora still (just barely) holds the crown as the largest audio streaming platform in the U.S. But both are feeling increased pressure as Spotify, Apple Music and other streamers and podcasters become easier to access in the car and on smart speakers.
Broadcast radio, which has been feeling the same pressure from streaming, will now also have to fend off the combined strength of SiriusXM and Pandora.
SiriusXM has thus far failed to attract significant listenership online and in the home. But Pandora's music platform could enable SiriusXM to significantly expand its presence beyond vehicles.
SiriusXM has been interested in Pandora for more than a year. Last summer, the satellite broadcaster invested $480 million in cash in Pandora in exchange for a 19% stake.
Why It Matters
Following the completion of the transaction, there will be no immediate change in listener offerings, according to both companies. But that will change.SiriusXM is the leader in subscription radio and Pandora still (just barely) holds the crown as the largest audio streaming platform in the U.S. But both are feeling increased pressure as Spotify, Apple Music and other streamers and podcasters become easier to access in the car and on smart speakers.
Broadcast radio, which has been feeling the same pressure from streaming, will now also have to fend off the combined strength of SiriusXM and Pandora.
SiriusXM has thus far failed to attract significant listenership online and in the home. But Pandora's music platform could enable SiriusXM to significantly expand its presence beyond vehicles.
The combined company says that it will drive long-term growth by:
- Capitalizing on cross-promotion opportunities between SiriusXM's base of more than 36 million subscribers across North America and 23 million-plus annual trial listeners and Pandora's more than 70 million monthly active users, which represents the largest digital audio audience in the U.S.
- Leveraging SiriusXM's exclusive content and programming with Pandora's ad-supported and subscription tiers to create unique audio packages, while also utilizing SiriusXM's extensive automotive relationships to drive Pandora's in-car distribution.
- Continuing investments in content, technology, innovation, and expanded monetization opportunities through both ad-supported and subscription services in and out of the vehicle.
- Supporting and strengthening Pandora's brand.
- Creating a promotional platform for emerging and established artists, curated and personalized in ways to deliver the most compelling audio experience that connects artists to their fan bases, as well as new listeners.