Pandora 's (P) 'Refined' Algorithm's Could Ramp Profits
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Pandora Media (NYSE: P) shifted into negative territory Wednesday amid reports that the company is generating more traffic via refined algorithms.
The WSJ notes that Pandora's algos have been refined continuously over the last 10 years and that has lead to a marked increase in listening hours. That increase is tied directly to ad revs, which is an obvious positive for the company.
In the future, Pandora hopes to be able to tell how many people are in a room listening at one time.
Pandora collects information two different ways: directly and indirectly. Directly means users are skipping songs and pressing the 'like or 'dislike' buttons. Indirectly menas the application is closed or it is on, but users aren't listening. (The company posts a message with "Are you still there?" printed. No user response would be a measuring metric.)
All of those data points help Pandora select songs folks want to listen to.
There is human interaction for song selection; Pandora uses around 450 different values (song tempo, number of singers, etc.) to categorize and select songs. Given that humans and machines interact differently with different songs, that isn't likely to change anytime soon.
Like many music apps, Pandora doesn't push the ad-free premium model of its business, aiming instead to monetize the ad-enabled model even more. With measurable percentage gains on listener hours being reported each year, that shouldn't be hard for the venerable music streaming service.
Shares of PAndora are down 0.4 percent.
The WSJ notes that Pandora's algos have been refined continuously over the last 10 years and that has lead to a marked increase in listening hours. That increase is tied directly to ad revs, which is an obvious positive for the company.
In the future, Pandora hopes to be able to tell how many people are in a room listening at one time.
Pandora collects information two different ways: directly and indirectly. Directly means users are skipping songs and pressing the 'like or 'dislike' buttons. Indirectly menas the application is closed or it is on, but users aren't listening. (The company posts a message with "Are you still there?" printed. No user response would be a measuring metric.)
All of those data points help Pandora select songs folks want to listen to.
There is human interaction for song selection; Pandora uses around 450 different values (song tempo, number of singers, etc.) to categorize and select songs. Given that humans and machines interact differently with different songs, that isn't likely to change anytime soon.
Like many music apps, Pandora doesn't push the ad-free premium model of its business, aiming instead to monetize the ad-enabled model even more. With measurable percentage gains on listener hours being reported each year, that shouldn't be hard for the venerable music streaming service.
Shares of PAndora are down 0.4 percent.
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