Pandora Versus Sirius: Will Free Music Beat Paid?

By Matt Van Hoven 

It seems like each day brings more evidence that Sirius Radio just doesn’t get it. This week, Pandora launched another phase of their advertising outreach &#151 adding 15 second spots between songs to the inane Web/iPhone/Windows Mobile ads you probably haven’t been too bothered by. This is an all out battle; Pandora is gaining ground while Sirius stays the course, slowly losing out to their competitor &#151 though they may not even realize it.

Let’s begin with the benefits of Pandora. It’s a free service, including gratis iPhone and Windows Mobile apps, which are paid for by the 1.2 million impressions (that’s just iPhone) that their listeners provide. The average iPhone listener (1/5 of all iPhone owners have the Pandora app) jams out for 90 minutes per day. From what we’ve heard, the ads aren’t annoying, and because the service is free, users are less likely to whine.

Pandora also gives you the power to fine-tune your station. The more time you spend telling the program what you like and what you don’t (with a simple click) the better your music becomes.

Sirius also has an iPhone app (though the SiriusXM app is yet to launch &#151 word is, March), but it costs $12.99. Oh, and so does the monthly service ($12.99). One of Sirius’s problems has been getting their technology in users’ hands. The iPhone solved that problem for them, but they made a huge mistake by charging for it. Anyone who paid $299 for their 3G wouldn’t be all psyched to drop another $13 (plus the yearly membership fees) when Pandora does essentially the same thing for free.

Yes, Sirius does talk, and Pandora doesn’t. They’re different products, but the platform/marketing strategy Pandora uses could do a lot for a hurting Sirius. For one thing, they should give away the next iPhone app for free, and offer a free month to everyone. Of course, you must enter a credit card number first, and then call to cancel at month’s end.

Here’s another thought &#151 two types of memberships. The first is the same plan you’ve got going now, $12.99 a month, commercial free. The second is $5.99 a month and, wait for it…wait for it, includes some commercials. OMG! Pandora has proven that people will “suffer” through ads for good tunes. The same is possible for people when they know they’re getting a deal. “Yeah, there’s some ads, but it’s half the price of the other service and I get the same music…” We’ll let you figure out the details.

Final thought: Sirius has a great product. They allow you to personalize so much of their content that once it’s in your hands, you won’t want to give it up. That is, unless you can get the same satisfaction from Pandora. Fewer of us are driving, and we’re less likely to drag another tech-device along with us thanks to the all-in-oneness of the iPhone era. Keep that in mind.

More: “Dear Sirius, Please Get Your Sh*t Together

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