It’s always exciting when successful tech companies go public. Many people think of IPO’s similar to playing the lottery; emotions begin to cloud judgement and the basic emotions of greed and fear spill into each potential investment. But, when you are in the business, there’s foresight that could make you a lot of money.
Pandora is is the premiere internet radio station. You begin by selecting a single song or artist and Pandora will choose the next songs to play. As you rate whether or not you like the next song that is played, a customized playlist is derived precisely to what your taste is. There are many other features, many of which I’m sure you are aware of. Read about it here.
There are 23 competitors out there:
The Hype Machine, Grooveshark, Deezer, Live365, iLike, Last.fm, LAUNCHcast, MeeMix, Music Genome Project, MOG, WhoSampled, Musicovery, OurStage.com, play.it, Radiolicious, Slacker, Songza, Spotify, Stitcher Radio, ShareTheMusic, Zune Software
Of those competitors, I believe Pandora to be the best. I’d rate Slacker second to Pandora. The differences are decided by music repository, customization features, and ease of accesses via mobile devices and browsers. Pandora succeeds in all these categories.
This IPO marks the transition from FM and Satellite radios to Data radios over 3G and 4G networks. Even older technologies can still stream Pandora. But with 4G networks getting to 100Mbps, solid is standard. 40 – 50% of United States citizens own a smart phone, which will continue to saturate, while internal car devices will soon hold data packages to interact with GPS, communications, and even Radio.
I’m particularly excited about this IPO. Just recently, Slacker Radio raised $3 Million to expand services into cars and mobile devices, compared to Pandora who is filing for $100 Million. The difference in size is substantial, but Pandora is still working on grossing profits. That aside, I believe that Pandora should be traded on hype and then closely watched for future development. It will take a lot of work due to the nature of competition.
Trade this, don’t invest. Every time a buy order is placed, a (stop) sell order must also be placed. It should be a lot of fun!