American streaming music firm Pandora is downsizing its workforce by about 5% in a bid to save $45 million annually. The staffing changes follow a rejig at the top of the struggling digital music business last year that saw a new CEO brought in after satellite broadcaster Sirius XM took a significant stake in the company.
When Sirius bought into Pandora it bigged up the extensive reach of the personalised radio service’s free-to-access platform, describing the loss-making streaming firm as “a leading player in the burgeoning digital audio advertising market”.
That was despite Pandora’s previous management focusing on diversifying the business so that it was less reliant on advertising income, partly through a short-lived dalliance in the ticketing sector, and partly by ramping up its subscription products.
Most agree that subscription streaming – while not yet a proven business model – has more potential for long-term profitability than ad-funded services, though by moving into that territory Pandora goes more directly up against competitors like Spotify and Apple Music.
Seeming to confirm that the new management are more focused on growing the core advertising side of the Pandora business, the company said that the latest restructure will also see an increased focus on advertising technology and audience development.
It’s also hoped that further cost savings can me made by shifting more of its workforce to a base in Atlanta, where overheads are lower than at the company’s headquarters in Oakland, California.
According to the Financial Times, Pandora’s board approved the latest restructure on 11 Jan and affected employees were informed yesterday. The restructure should be pretty much completed by the end of the first quarter of 2018.[from http://ift.tt/2lvivLP]