Pandora internet media has recently expanded its operations by the acquisition of Rdio and TicketFly. These acquisitions are the right steps taken by Pandora towards the right direction. The company is facing a challenge of rising royalty rates from the licensing agreements they sign with the content providers such as Sony.
The company has recently experienced an increase in the amount of expenses incurred in its operations. International expansion would means that the company would be able to increase it's the amount of revenue generated hence spreading out the fixed costs which mean the overall expenses would be lesser. Pandora might consider entering into the United Kingdom by the end of the year which has a significant amount of potential users, Since the largest expense of Pandora is the royalties the pay to the copyright owners then the best approach would be one that keeps this cost at the lowest level possible otherwise they might not survive in the market. A close relationship with the artists and productions agencies will provide them the opportunity to negotiate a revenue sharing model (Trefis Team). Ann expansion to the international market should be part of their top priorities. It will improve their brand awareness as well as enhance their overall brand image.
I believe Pandora is effectively pursuing strategic goals with its global expansion plan. A company that seeks to expand internationally will be in a position to enjoy numerous benefits with the most significant being brand awareness. Brand awareness is directly proportional to the success of a company. Since the company relies on the internet to provide its services, then careful consideration of the availability of this infrastructure should be considered before expanding into a particular country.
Work Cited
Trefis Team. What Do Pandora's Recent Acquisitions Have To Offer? 23 Nov. 2015. Web. 29 Apr. 2016.
