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Pandora, an online radio service, had a public offering of stock on June 15, 2011. Many are saying that its success in the public offering is part of a new tech bubble in the stock market. As of April had 90 million registered members, which is up from 80 million in February. Its members racked up 3.8 billion hours of listening to Pandora’s song stream at the end of the 2011 fiscal year. But as its audience grows, so does its biggest cost: the royalties it pays for the music it streams. Pandora’s filing said its current rates for royalty payments are good until 2015, after which it will need to renegotiate.


1. Pandora was founded in 2000, but it wasn’t known as “Pandora” at the time. What was its original name?

2. Who are Pandora’s competitors? What are the problems with Pandora’s business strategy?

3. The video mentioned Zip Car ( as a new IPO.  What is an IPO?  Look up Zip Car.  What is the focus of this business? 

4.  Compare the Pandora product and the Zip Car product.  Which do you think will be more successful and why?

5.  Pandora was expecting to raise about $100 million with their stock offering and instead raised $250 million.  What percentage is this over their expectations?


Pandora CEO Kennedy (, June 15, 2011

Siegler, M. (2011). Pandora Puts The “P” In IPO — Our Talk With Them On The Big Day , Tech Crunch, June 15 (Retrievable online at