Picture this (it shouldn’t be hard): you’ve got a deadline coming up, for work or school, and you need to crank out a few hours of serious TCB (takin’ care of business) at your keyboard. To ease the pain, you blast some tunes. And why not? You have all the tools you need – an internet connection and some speakers. There are currently a few online music streaming services offering free music plays, free “radio” stations and a few other features such as improved sound quality and interface customization for a fistful of dollars that you can turn to in your time of need.
A few of the players in this space are Pandora, Grooveshark, Last.fm, and The Hype Machine. Each is a little different. The Hype Machine is a music blog aggregator, playing songs that are frequently discussed online. Grooveshark is notable for its blend of on demand song plays with “radio stations” that recommend music based on genres and user feedback. Pandora is the granddaddy of the music suggestion family, utilizing the Music Genome Project to categorize elements of songs and suggest new artists based on common elements liked and disliked by users. Granted, song availability tends to differ from service to service (no Pink Floyd on Grooveshark, The Hype Machine skews more towards indie and dance and mash-ups, and I find the lack of electronica on Pandora disturbing) but for the most part, the ingredients are largely the same. So, whose cuisine reigns supreme?
According to compete.com data, Pandora is well ahead of the rest of the bunch and over the last year has done an admirable job of growing the gap. In August 2010, Pandora received about 2.2 million more unique visitors than its closest competitor, Last.fm. By August 2011, that margin has grown to nearly 9 million UVs. These visitors translate to cash for the services; in addition to the subscriptions, they all sell ad space on their sites and display these ads to nonpaying members. Last.fm, Grooveshark, and The Hype Machine are all showing a decline in traffic year-over-year while Pandora continues to gain unique visitors.
Why might that be? One theory that occurred to me was the supremacy of Pandora’s mobile app, using ratings on Apple’s App Store as a metric to measure the quality of the apps. Apps are all the rage, and many brands from Starbucks to Nike to the Weather Channel are trying to gain awareness through apps. Looking at user feedback on the App Store, Pandora appears to be the clear cut winner, compared to other music streaming sites, with mostly positive reviews. iPhone users criticize Last.fm’s app for crashing a lot, lacking features, and, ironically, limiting the amount of songs that can be played in a given time period. The Hype Machine’s offering has negative reviews pointing out that it is not free like the others, and offers very few bells and whistles. Due to legal issues, Grooveshark doesn’t even have an app outside of jailbroken devices. The combination of an easy to use desktop site with a mobile application that meets online consumers’ expectations may be what sets Pandora apart from the competition.
What can these competitors do to step up their game? Well, they can address the aforementioned issues with their mobile apps to try and get users to see them as a one-stop-shop for both mobile and desktop music streaming. Purchasing of display inventory can also help increase awareness and interest. Grooveshark seems to have pretty good search engine optimization, appearing as the first organic result for terms like “free music” but only Pandora seems to be buying paid search results. These competitors can also attack some of Pandora’s drawbacks, such as the inability to choose specific songs to listen to and the inability to replay songs you like, and promote why they are better in those respects.
Pandora’s competitors should start thinking about some ways to improve their online presence sooner rather than later, as Pandora certainly isn’t resting on its laurels. Pandora has recently unveiled a new site with a clean user interface, pre-made radio stations, and even easier to create and manage customized stations. Perhaps the biggest win for Pandora with the release of their new site is its social integration. A “share” button directly under the album artwork allows users to quickly share songs they have discovered with their friends on Pandora, Facebook, and Twitter. This could drive people who aren’t currently using Pandora to make the switch now that it is very easy to share your music preferences and discoveries with friends.
The chart above shows that Last.fm has a disproportionately large gap between referrals from Google and Facebook, compared to its competitors. Looking at absolute numbers, Grooveshark has more than four times as many Facebook referrals as Last.fm (1,524,081 to 344,608), despite the fact that Last.fm has more overall traffic than Grooveshark. This suggests that Last.fm could possibly close some of the gap on Pandora by improving its visibility in social networking.
With the release of Facebook Music, Facebook may have just thrown a curve ball at the world of online streaming music. Users will be able to “like” songs on certain streaming music sites, which will be posted to their Facebook profile. Their friends will then be able to check these tracks out by following the links created. It seems that users will be directed away from Facebook to actually listen to the song, which isn’t great from an end user experience, but it wouldn’t be wise to underestimate what an impact this could have on streaming music given Facebook’s gargantuan size. Any online streaming music provider not wanting to be left in the dust might want to fall in line and sign up with Facebook Music. So far, of the sites mentioned above, it seems only Pandora will have this integration. Facebook Music integration along with the release of an updated site shows Pandora is really stepping up its game in an attempt to remain the king of online streaming music.
By now most of us have gone to the well of free (or low fee) streaming music to help pass the time at work or school. But which service do you prefer, and why? What features does your personal favorite have that others lack? Can one among the competition make up some ground on Pandora?