Streaming services are the new kings on the music block, but who will be the future king of music kings?

Despite its ubiquity and success, Spotify seems to face lawsuit after lawsuit. Its latest one focuses on equal pay violations along with other gender-based workplace discriminations.

In fact, piracy still remains a concern in days where $10 a month gets you access to millions of songs or an internet connection gets you access to millions of YouTube videos of songs, live performances, and music videos.

But SiriusXM just bought Pandora, the streaming radio service, for $3.5-billion USD.

What does this mean for the consumer base moving forward?

image of headphones for article SiriusXM Pays Huge for Pandora, Spotify in new Lawsuit
HOerwin56 | Pixabay

Diversity of Services and Differences in Features

We can’t state explicitly that music streaming could be heading down the path of wireless and internet providers. After all, there are only two major internet providers and four major wireless providers in America.

With recent FCC blessed mergers, that number is somehow shrinking, as well.

But music streaming, so far, remains unaffected by these kinds of oligarchies. In fact, there are still several major streaming services that are low-cost or free — Pandora being one.

The list also includes:

  • Spotify
  • Apple Music
  • Google Play
  • Soundcloud
  • Tidal

All of those platforms come with their quirks and issues, of course. But each platform wants to find ways to “one-up” the competition and claim a bigger piece of the music streaming audience pie.

For instance, Apple Music now incorporates Genius lyrics. Apple also recently acquired music identification app Shazam for $400-million USD.

Also, Google Maps lets you control music while navigating apparently. Google also make Sound Search improvements to enhance its music-recognition skills.

Tidal remains the outlier, but it just passed the 1 million mark in high-quality tracks. Of course, you have to be a specific type of subscriber and use the desktop app to access these tracks.

But most of these apps have music industry-independent operators. This excepts Tidal, which was originally started by Norwegian company Aspiro ABProject Panther Bidco Ltd., a Jay-Z owned company, then acquired them in 2015.

But SiriusXM functions as a satellite-based radio and podcast company. What does its acquisition of Pandora mean for the market?

image of a man in front of a Pandora sign at the NYSE for article SiriusXM Pays Huge for Pandora, Spotify in new Lawsuit
The all-open stock deal will go live in 2019 after the acquisition. | Getty Images via Marketwatch

A Buyout That’s More Like a Partnership

Like Spotify, Pandora struggled with music labels over licensing rates for songs. That financial strain did not affect Pandora’s overall usership, however. It maintained 70-million active users to SiriusXM’s 36-million subscribers.

The company, admittedly, wanted a buyer to come scoop them up, despite launching their premium on-demand service similar to Spotify last year.

But SiriusXM stated that Pandora would continue to function as a separate service.

The company hopes that, since the two entities focus on complementary audiences, they can expand usership for both services. As such, SiriusXM will leverage its automotive relationships to amp up Pandora’s in-car distribution.

In turn, SiriusXM hopes that it can parlay free, ad-supported Pandora users into SiriusXM service subscribers.

Perhaps Pandora will use its matching algorithm for podcasts, now? Only time will tell.

Should Spotify be worried about SiriusXM and Pandora joining forces?

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