The biggest streaming radio player just bought the biggest independent ticket retailer in the United States. Pandora announced Wednesday that it has acquired Ticketfly for $450 million.
Pandora has only just begun to dip its toes into live music and ticketing. In January, more than 720,000 Pandora users tapped into a Jack White show at Madison Square Garden that was live-streamed and shown in the following days on a specially designed Pandora station. This past spring, when it partnered with AEG to sell tickets to an upcoming Rolling Stones tour, 55,000 people bought tickets in just 24 hours. Wednesday's acquisition suggests it likes what it saw.
"Pandora is about to become a major player in ticketing," Ticketfly co-founder and CEO Andrew Dreskin wrote in a blog post addressing the acquisition. Ticketfly is not on the same level as Ticketmaster, which sold 37 million tickets in the second quarter of 2015. But it has grown into the ticketing service of choice for a number of independent promoters. The service sold more than 16 million tickets to over 90,000 events last year -- not all of them to music events.
This deal gives Pandora a chance to increase the average amount of money it generates from its enormous base of listeners. While it boasts more than 80 million monthly users, the overwhelming majority of them use the service’s ad-supported model, which generates more than 80 percent of its revenue. Compared with services like Spotify or Sirius XM, Pandora’s average revenue per user (ARPU) is quite a bit lower. According to the company’s most recent quarterly earnings, Pandora lost $16 million last quarter.
For the promoters and venues that use Ticketfly, Pandora’s move will give them another opportunity to target fans. “The combination of Ticketfly and Pandora will be game-changing for our clients,” Dreskin wrote. “Ticketfly and Pandora will be a marketing and event discovery powerhouse. ... This will enable promoters to sell out more shows.”
Last year, Pandora announced it was giving musicians the chance to tap into data about where their songs are played most often and by whom. In May, it added another layer of insight when it acquired Next Big Sound, a music data company.