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Tim Westergren, Pandora, Is Internet Radio Dead?

Thursday, November 15th, 2007 – running time 15:52
"The day that an MP3 player is always connected [to the internet] is the day when broadcast radio vanishes" says Pandora.com's Tim Westergen, a leader in the fight to save Internet Radio.

"The day that an MP3 player is always connected is the day when broadcast radio vanishes" says Tim Westergen, a co-founder of Pandora.com.

Pandora is an "automated music recommendation and Internet radio service" created by the "The Music Genome Project".

Music Genome? Tim explains how the process works... think using over 400 attributes to describe songs, and an algorithm to parse them and pick a song you'll like.

Nice concept, but will Internet radio survive the next year? Tim explains the latest happenings with the U.S Copyright Royalty Board's recent royalty fee hike that could kill off Internet radio.

The big question: Are the performance royalty rates fair across the board for terrestrial, satellite, and Internet radio? It seems like terrestrial radio is getting a serious advantage.

Hitlines:

RackSpace outage -- A trucker slammed into a power transformer this week. That knocked RackSpace offline --which lead to a number reputable websites going down.

Google Releases Android SDK, $10M for Developers - Get your mobile programming on. This week, Google unleashed the Android SDK to developers... and a $10 million developer challenge!

Economic Tech Slump? - Has the U.S. broadband Internet subscribers peaked? In a recent report, UBS forecasts that the total annual subscriber growth for the U.S. will be 16 percent in 2007, and will decline to 12 percent and 10 percent in 2008 and 2009.

Highlights
Labor Department ( 5:24, 5:24 ) Steve Jobs ( 14:53, 14:53 ) publishing company ( 2:16, 2:16 ) iPhone ( 0:44, 0:44 ) Labor Department ( 5:24, 5:24 ) Steve Jobs ( 14:53, 14:53 ) publishing company ( 2:16, 2:16 ) iPhone ( 0:44, 0:44 )

Automatically Generated Transcript(may not be 100% accurate) ( more )

" The get go home show you sponsored by jangled."

" Hey welcome to Diego show I'm and I'm doing."

" Figure it what do we have this week we have a couple things talk about the first all life is so glum dressed in black from head -- go -- just American my."

" You -- another one yeah I have a new Nokia N 958. Gigabyte. Music phones they over the at a time. I mean over the iPhone pro line -- that's next new thing yes I just decided to coordinate and you're a little tired is one of us stores are recovering today is. Yeah kinda knocked me out. Nowadays I have but before we go you just knew that he kitten is like exclusively -- new look he had."

" You can we should show the future so -- is -- little luck that you don't really."

" Hey I didn't if you want to biden's you can just right plus but you gotta make leading shirt sleeves and I think pick. You know you mean if you. Anyway and it's also good on d.s often acts that."

" In the days after recognize and one of the things that happened this week was that rack space is right widely considered one of the more stable reputable postings -- they went down not one. The twice as. -- once but twice. Which shows some time. Issues that we have here in the US consulate building up on -- infrastructure that isn't really all there we don't have redundancy that we need lots of people sites were down."

" That it was a stupid -- some front are grown into a transformer and bone. There goes 37 -- and I pay and that he went and often screen our friends Clark being right for a guy who suffered a large. Mean you know this is just not cool I mean this happened to me too often is."

" Red -- earlier this year with twice acting happy thanks to find the editors excited mean here in San Francisco -- how -- lot of startups analyze the publishing company. That that are based here again."

" In fact we've done a lot of you know that sanctions community -- have -- on. Site communications lead this is not. You know it's it's the weakening."

" So server hosting it's not sexy work but it's hard and it's essential thing yet we really start focusing on those companies missing what they're doing. With the deficiencies aren't what they can do to get better and it."

" Great and -- covering that more often on my side this you know write more -- and one thing I've been very analog of our industry is. Is through Google android right. And you know in the software development kit is available by the phones aren't going to be for some time for and then taking a cue off of FaceBook faith. You reserving ten million dollars to get out to developers in the contest which format that you'll see how to -- does is good for that developers and you know I think they you can actually do get going being in -- applications that are from. I you know and that's something you can't argue this it's a good thing for the -- it and it. And it lets you I -- kicked out -- and we have a little bit of bad news in the US economy that's. Showing through and pick numbers yeah you know a lot of people are not talking about this by. Do you hag the Internet advertising has slowed down quite a bit because of the big spenders are staying -- the financial. Institutions. You have brought Brian it's starting just you know random because there is. There's a bunch of reasons -- enormous penetration and I am now and everything is their homes and new home construction when you -- down between aren't as -- connection right. And the third aspect you can use to use some more bad news coming his. Even the largest post case. Subscriber numbers this just don't know quite quite debate and this is -- it's -- community is scary and let's see how the fourth quarter dogs I think that could humor is flying me. Maxed out their credit -- of himself."

" But a separate areas that are grown so we do have one area that still crying and it's. -- upcoming guests."

" Right you have him musical partner pandora. Even don't talk about social music and you -- tell us how he's doing."

" Or anything too little and -- biggest and -- so we'll be right back with him until founder of pandora."

" Welcome back I'm home she's Joyce and -- talking -- cofounder of pandora which is a music oriented start up again. I -- thank you for joining us today absolutely no protests in -- Labor Department oral order does and why should our you know viewers care about yours."

" So it's a personalized radio service allows people very quickly and easily create radio stations based on songs or artists like. And -- that's on top of something called the music genome project which is an enormous. Musical acts on you know we've been working on or about eight years now we have a team of about fifty trained musicians and days and today is listening to songs and analyzing each song along close to 400 musical attributes so we capture every detail melody and harmony and rhythm and former instrument -- Vocal performance and and took each aspect of the songs broken down into its most basic compounds. And that's -- different from let's say I'm -- spectrum. Because they have more if you can be and I debates. Yeah that's right and we used sort of the musical qualities themselves and that song so to launch a station and -- you type in a song let's say. We look at that's long musical DNA and then the album goes searching for other songs are musically similar and that's what we use as the basis for playstation."

" But you haven't go to put down just in addition to tracking how I attracted my music you'll attract how. My interest align with other people's interest and then start recommending things that other people who have much -- her."

" Yeah I mean our our belief is that the right that the best recommendation -- thing system uses all those functions so. Not only can you give thumbs up or thumbs down and have -- sort of cure -- your station. We look at it every song. That for every station which it's played -- behavior of the aggregate audience. So it's a way for the audience to tell us I -- you think that this song belongs on the whole playstation that we don't all thanks. And certificates come down too much will suppress the station for every so."

" the marble head is and you stream the music and an active supporter. -- in line ads -- other actions of upside part of it for. It's it's."

" Predominantly visual so when you're on pandora two years surrounded by an advertisement. And one of the sort of age old problems for Internet radio becomes a business model is most of the time you. Turn on when you minimize -- do something else. But pandora is a very engaging service of people are always going back to it the -- songs just get them to learn about it and that gives us the opportunity to and."

" Recently we had this vote for you know prove about. I -- you don't have broken your. Order of business smarter -- just like you were so active do you give us update on what's what's going on and I you know between."

" So in a nutshell the performance speed that we pay for every song we street Louis massively increased a few months ago about triple. And as -- settlement if it stays at that rate we're done as is every other webcaster. Com shortly after that happened -- we be pushed for this big the grassroots opposition to that was so overwhelming that congress intervened. Some people to Washington. All the players -- way and nor was there -- legislators and said you know. Look something about me wrong here you again figure out an answer. And so we're now. We're paying a higher fees but we're in a sort of period of supervised negotiations. Under the act congress basically so. Hoping we can we all up and -- him I mean the most absurd part of this whole thing is that. All these forms of radio via -- and -- or cable radio or satellite. -- and radio are all competing with each other. But Internet radio is the only one that's been tagged with this rate which is. Ten times more than satellite pays. And terrestrial broadcasters don't pay at all so this is wildly unfair. Licensing system. In in a market where people are competing directly with each other you can get pandora phone. You can listen to -- your car. Or user that's not that different from terrestrial radio and yet we have this -- and all around our neck."

" Why is it that you know these guys don't you can -- I know in this devious park last FNB cases I think again that the future is. More customized radio. Why is it -- and have you I'm sure you talked to games can actually you guys. And they don't get it I -- like just isn't just the Hollywood disease they suffer from what that is it."

" Well I don't think that. That broadcasters for one are all the same I think they had different. Dispositions towards -- and I would San the last six months as an industry they've really recognized how. Important apparently is going to be the future and they're not the ones that are pushing you -- these rates are being pushed by primarily large record labels."

" For the record guys have basically trying to figure out how to keep. You know. Back when making businesses. You know and and they making money and your -- on -- Allard you know good stuff."

" It's -- thought it would you know there's -- live I think there's also the target site. -- that you as a developing platform will be able to provide some of the information you've gotten to artists. Feels that they're better hone their marketing build their business models of -- hopefully not."

" Sure some of the whole reason I started this company was I want that provide a way for. Independent musicians working musicians and audience I was an arm -- for many years myself. And now that we've built this pretty large audience that's well over -- newly -- I'm. One of the things we really want to do is leverage all the stuff that's happening on pandora the discovery and actions and make that available to musician so they can use it. To build and bases and a large enough to support. And so we are going through some major. Are testing process right now to figure out how do you really. As an easy way. Give have access to the power. To musicians and 70% of the C he's in our collection come from artists who don't have an affiliation with major record label. It's not that we have anything against me directly if not all but. It's it -- and knew it had Trulia in the average. Sales have a CDs sold pandora on us on this over a 100000. I know that we aren't impacting musicians so if you. If you look at sort of activity on pandora and corresponds -- yet musicians will frequently right in saying. Couple months ago my iTunes sales to -- despite. And I realized that was the day I happen to pandora so we're starting to have an impact we're still small asking me. We're nine plus million we're nine million. I think that. When you get your music as the pandora like that day you're you're life hasn't changed that. What is he goes through it and we grow a little over half a million. News and human nature and an advertising business like ours is you have to get investment money. That's not get going. Hope your ad revenue catches up with -- before you call the class. -- they're -- yeah accept these rate -- rate you know nonsense. If we can get that figured out. The business models work -- And La -- and tempers. And that's time for plan -- makes the -- Certainly a big hurdle for us in terms of the broad adoption is there is some -- really ubiquitous high speed connectivity. The data and MP3 players always connected us today I think broadcast radio advantages at least as a music community. I think -- radio completely take over you know me you know one mind about when you ask me I hope that you know broadband -- I get citizens."

" Your tech blogger -- thing. When did Jesus say that I think Stanford often by going to like him when they learn tonight you know. I'm sorry I can't make it maybe you can't do anything in your public. And we're back. Yeah yeah."

" Hello welcome back and now we have our viewer comments and feedback."

" so we have yet to say it. Asia and investing heavily in IQ related infrastructure. Would you consider doing -- these unions are artwork is that these key activities in this article or should he lose can't we -- Actually that is not true because. You know hold on your views on who -- setting up shop right. In India and China supplied. Did okay and everything moving on our earth is honored him kingpins. I think it's a great topic for -- was -- the way you and me to him again. Kinda you know. We shared so meaning when you hear me do something."

" Speaking of raising money we had another person right in dated was riding in I think coming off the -- that you had when. When are when deadlines I think Steve Jobs is talking she's raising money. And did wants to know only one question remain film how much money did you raise. -- from need to knowing you again okay -- if you're gonna have to wait a little bit longer for the answer and that one but in the meantime please -- it then they love getting in all the rain forms you can write us at eight -- at revision3.com. And there yeah that's it that's it for that to have phenom now and I promise not to dressed in black and -- have minimal average. They stay -- week."

" The get go home show. The get go home show is sponsored -- jangled."

" The get go home show you sponsored by jangled."

" Hey welcome to Diego show I'm and I'm doing."

" Figure it what do we have this week we have a couple things talk about the first all life is so glum dressed in black from head -- go -- just American my."

" You -- another one yeah I have a new Nokia N 958. Gigabyte. Music phones they over the at a time. I mean over the iPhone pro line -- that's next new thing yes I just decided to coordinate and you're a little tired is one of us stores are recovering today is. Yeah kinda knocked me out. Nowadays I have but before we go you just knew that he kitten is like exclusively -- new look he had."

" You can we should show the future so -- is -- little luck that you don't really."

" Hey I didn't if you want to biden's you can just right plus but you gotta make leading shirt sleeves and I think pick. You know you mean if you. Anyway and it's also good on d.s often acts that."

" In the days after recognize and one of the things that happened this week was that rack space is right widely considered one of the more stable reputable postings -- they went down not one. The twice as. -- once but twice. Which shows some time. Issues that we have here in the US consulate building up on -- infrastructure that isn't really all there we don't have redundancy that we need lots of people sites were down."

" That it was a stupid -- some front are grown into a transformer and bone. There goes 37 -- and I pay and that he went and often screen our friends Clark being right for a guy who suffered a large. Mean you know this is just not cool I mean this happened to me too often is."

" Red -- earlier this year with twice acting happy thanks to find the editors excited mean here in San Francisco -- how -- lot of startups analyze the publishing company. That that are based here again."

" In fact we've done a lot of you know that sanctions community -- have -- on. Site communications lead this is not. You know it's it's the weakening."

" So server hosting it's not sexy work but it's hard and it's essential thing yet we really start focusing on those companies missing what they're doing. With the deficiencies aren't what they can do to get better and it."

" Great and -- covering that more often on my side this you know write more -- and one thing I've been very analog of our industry is. Is through Google android right. And you know in the software development kit is available by the phones aren't going to be for some time for and then taking a cue off of FaceBook faith. You reserving ten million dollars to get out to developers in the contest which format that you'll see how to -- does is good for that developers and you know I think they you can actually do get going being in -- applications that are from. I you know and that's something you can't argue this it's a good thing for the -- it and it. And it lets you I -- kicked out -- and we have a little bit of bad news in the US economy that's. Showing through and pick numbers yeah you know a lot of people are not talking about this by. Do you hag the Internet advertising has slowed down quite a bit because of the big spenders are staying -- the financial. Institutions. You have brought Brian it's starting just you know random because there is. There's a bunch of reasons -- enormous penetration and I am now and everything is their homes and new home construction when you -- down between aren't as -- connection right. And the third aspect you can use to use some more bad news coming his. Even the largest post case. Subscriber numbers this just don't know quite quite debate and this is -- it's -- community is scary and let's see how the fourth quarter dogs I think that could humor is flying me. Maxed out their credit -- of himself."

" But a separate areas that are grown so we do have one area that still crying and it's. -- upcoming guests."

" Right you have him musical partner pandora. Even don't talk about social music and you -- tell us how he's doing."

" Or anything too little and -- biggest and -- so we'll be right back with him until founder of pandora."

" Welcome back I'm home she's Joyce and -- talking -- cofounder of pandora which is a music oriented start up again. I -- thank you for joining us today absolutely no protests in -- Labor Department oral order does and why should our you know viewers care about yours."

" So it's a personalized radio service allows people very quickly and easily create radio stations based on songs or artists like. And -- that's on top of something called the music genome project which is an enormous. Musical acts on you know we've been working on or about eight years now we have a team of about fifty trained musicians and days and today is listening to songs and analyzing each song along close to 400 musical attributes so we capture every detail melody and harmony and rhythm and former instrument -- Vocal performance and and took each aspect of the songs broken down into its most basic compounds. And that's -- different from let's say I'm -- spectrum. Because they have more if you can be and I debates. Yeah that's right and we used sort of the musical qualities themselves and that song so to launch a station and -- you type in a song let's say. We look at that's long musical DNA and then the album goes searching for other songs are musically similar and that's what we use as the basis for playstation."

" But you haven't go to put down just in addition to tracking how I attracted my music you'll attract how. My interest align with other people's interest and then start recommending things that other people who have much -- her."

" Yeah I mean our our belief is that the right that the best recommendation -- thing system uses all those functions so. Not only can you give thumbs up or thumbs down and have -- sort of cure -- your station. We look at it every song. That for every station which it's played -- behavior of the aggregate audience. So it's a way for the audience to tell us I -- you think that this song belongs on the whole playstation that we don't all thanks. And certificates come down too much will suppress the station for every so."

" the marble head is and you stream the music and an active supporter. -- in line ads -- other actions of upside part of it for. It's it's."

" Predominantly visual so when you're on pandora two years surrounded by an advertisement. And one of the sort of age old problems for Internet radio becomes a business model is most of the time you. Turn on when you minimize -- do something else. But pandora is a very engaging service of people are always going back to it the -- songs just get them to learn about it and that gives us the opportunity to and."

" Recently we had this vote for you know prove about. I -- you don't have broken your. Order of business smarter -- just like you were so active do you give us update on what's what's going on and I you know between."

" So in a nutshell the performance speed that we pay for every song we street Louis massively increased a few months ago about triple. And as -- settlement if it stays at that rate we're done as is every other webcaster. Com shortly after that happened -- we be pushed for this big the grassroots opposition to that was so overwhelming that congress intervened. Some people to Washington. All the players -- way and nor was there -- legislators and said you know. Look something about me wrong here you again figure out an answer. And so we're now. We're paying a higher fees but we're in a sort of period of supervised negotiations. Under the act congress basically so. Hoping we can we all up and -- him I mean the most absurd part of this whole thing is that. All these forms of radio via -- and -- or cable radio or satellite. -- and radio are all competing with each other. But Internet radio is the only one that's been tagged with this rate which is. Ten times more than satellite pays. And terrestrial broadcasters don't pay at all so this is wildly unfair. Licensing system. In in a market where people are competing directly with each other you can get pandora phone. You can listen to -- your car. Or user that's not that different from terrestrial radio and yet we have this -- and all around our neck."

" Why is it that you know these guys don't you can -- I know in this devious park last FNB cases I think again that the future is. More customized radio. Why is it -- and have you I'm sure you talked to games can actually you guys. And they don't get it I -- like just isn't just the Hollywood disease they suffer from what that is it."

" Well I don't think that. That broadcasters for one are all the same I think they had different. Dispositions towards -- and I would San the last six months as an industry they've really recognized how. Important apparently is going to be the future and they're not the ones that are pushing you -- these rates are being pushed by primarily large record labels."

" For the record guys have basically trying to figure out how to keep. You know. Back when making businesses. You know and and they making money and your -- on -- Allard you know good stuff."

" It's -- thought it would you know there's -- live I think there's also the target site. -- that you as a developing platform will be able to provide some of the information you've gotten to artists. Feels that they're better hone their marketing build their business models of -- hopefully not."

" Sure some of the whole reason I started this company was I want that provide a way for. Independent musicians working musicians and audience I was an arm -- for many years myself. And now that we've built this pretty large audience that's well over -- newly -- I'm. One of the things we really want to do is leverage all the stuff that's happening on pandora the discovery and actions and make that available to musician so they can use it. To build and bases and a large enough to support. And so we are going through some major. Are testing process right now to figure out how do you really. As an easy way. Give have access to the power. To musicians and 70% of the C he's in our collection come from artists who don't have an affiliation with major record label. It's not that we have anything against me directly if not all but. It's it -- and knew it had Trulia in the average. Sales have a CDs sold pandora on us on this over a 100000. I know that we aren't impacting musicians so if you. If you look at sort of activity on pandora and corresponds -- yet musicians will frequently right in saying. Couple months ago my iTunes sales to -- despite. And I realized that was the day I happen to pandora so we're starting to have an impact we're still small asking me. We're nine plus million we're nine million. I think that. When you get your music as the pandora like that day you're you're life hasn't changed that. What is he goes through it and we grow a little over half a million. News and human nature and an advertising business like ours is you have to get investment money. That's not get going. Hope your ad revenue catches up with -- before you call the class. -- they're -- yeah accept these rate -- rate you know nonsense. If we can get that figured out. The business models work -- And La -- and tempers. And that's time for plan -- makes the -- Certainly a big hurdle for us in terms of the broad adoption is there is some -- really ubiquitous high speed connectivity. The data and MP3 players always connected us today I think broadcast radio advantages at least as a music community. I think -- radio completely take over you know me you know one mind about when you ask me I hope that you know broadband -- I get citizens."

" Your tech blogger -- thing. When did Jesus say that I think Stanford often by going to like him when they learn tonight you know. I'm sorry I can't make it maybe you can't do anything in your public. And we're back. Yeah yeah."

" Hello welcome back and now we have our viewer comments and feedback."

" so we have yet to say it. Asia and investing heavily in IQ related infrastructure. Would you consider doing -- these unions are artwork is that these key activities in this article or should he lose can't we -- Actually that is not true because. You know hold on your views on who -- setting up shop right. In India and China supplied. Did okay and everything moving on our earth is honored him kingpins. I think it's a great topic for -- was -- the way you and me to him again. Kinda you know. We shared so meaning when you hear me do something."

" Speaking of raising money we had another person right in dated was riding in I think coming off the -- that you had when. When are when deadlines I think Steve Jobs is talking she's raising money. And did wants to know only one question remain film how much money did you raise. -- from need to knowing you again okay -- if you're gonna have to wait a little bit longer for the answer and that one but in the meantime please -- it then they love getting in all the rain forms you can write us at eight -- at revision3.com. And there yeah that's it that's it for that to have phenom now and I promise not to dressed in black and -- have minimal average. They stay -- week."

" The get go home show. The get go home show is sponsored -- jangled."