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  • Is Pandora A Good Music Streaming Play? [View article]
    While you may have mentioned that Spotify and P are different in your article, much of the discussion in your article appears to assume they are similar businesses. This is a serious point of confusion for the casual investor that doesn't understand the music streaming business.

    The fact that Taylor Swift pulled her content from Spotify, but not from P should send a message about how different the two businesses are.
    Jul 28, 2015. 11:40 PM | 2 Likes Like |Link to Comment
  • Is Pandora A Good Music Streaming Play? [View article]
    Gotta agree with all the points made by dgulick here. Then again, I'm not long P, so I'm definitely biased.
    Jul 28, 2015. 11:36 PM | 1 Like Like |Link to Comment
  • Why Pandora Is Subject To A Further Downward Correction [View article]
    Agree with your point regarding monetization. From the perspective of leveraging P's product, the US is where P's biggest opportunity is.

    Also agree with the fact that bandwidth is becoming a fungible product. The problem is that its not free - yet. I suspect that in our lifetime, free or virtually free high speed internet/broadband will become a fact. Right now though, that's where I see P's biggest "bottleneck."

    I'm kicking myself for not buying P at $8. I remember thinking about pulling the trigger when it was that low. Even still, I'm pretty happy with my 2017 calls. I agree that the CRB rate setting in December could be a huge catalyst.

    The other thing is that if the rates are relatively in line with reasonable projections, then that should provide P with enough relative stability over the next five years to disclose and implement various plans (e.g. international expansion, etc.) that will hopefully provide even more reasons for the stock to go higher...

    Guess like most things, only time will tell...
    Jul 28, 2015. 11:32 PM | 2 Likes Like |Link to Comment
  • Pandora: Investors Should Be Patient [View article]
    @ Mikestesla

    your questions was: "Could you please provide the data from business stand point , what % from the revenue is Spotify transferring back to content providers vs. P."

    Spotify hasn't gone public yet so its not subject to the same reporting requirements that public companies are. If the information regarding the breakdown of how Spotify is spending its revenue is public information, then please share since I'd love to know.

    As for the rate information that dgulick posted in the comment below, well, that information was in my comment above: "Price paid out per stream from Pandora ranges from about 1/2 or 1/6th of what Spotify pays out, depending on the article you read."

    As for the question in your post above: "who determines the % royalty payments that go to artists ? Is it P or Spotify management or external forces ? Does P or Spotify have control of what % of their revenue goes to artists is what I am asking you?"

    The answer is - it depends. Private companies like P or Spotify can negotiate deals directly with music labels/artists. The Copyright Royalty Board (CRB) also establishes rates.
    Jul 28, 2015. 11:20 PM | Likes Like |Link to Comment
  • Why Pandora Is Subject To A Further Downward Correction [View article]
    Not so sure if I'd completely agree with opportunity in the US, since P's opportunity as a free ad based service (which is the company's bread and butter) will always be limited by bandwidth. This means you can only play P if you have an internet connection or can stream content over your phone. P's customer base is then limited to listening at home, or alternatively by the data plan on their phones (not everyone has an unlimited plan).

    This means that until there is free internet for everyone, everywhere, P will always be competing directly, to some degree, with terrestrial radio for advertising dollars. Right now, I suspect (no real data to prove it though) that most folks who have internet in the US have decided on which streaming service they want. On the other hand, there are overseas markets where streaming brands may be less established, and there is where I think P has opportunity for easy growth.

    I suspect P will announce international expansion once CRB rates are solidified. It is a company that understand's Wall Street's obsession with numbers and growth. If anything, the announcement will be made in an attempt to show large amounts of immediate growth in the short term - even if the "quality" of those numbers may not mean much.

    I'm not saying that this is a bad thing, but rather a game that P will likely play. By showing increased growth, it will have the ability to increase its stock price and use those gains for leverage when necessary.

    In any case, I am long P at this point and loaded up on Jan 2017 long calls before the Q2 earnings report. IMHO, the risk/reward profile was too attractive to pass up.
    Jul 25, 2015. 04:31 PM | 1 Like Like |Link to Comment
  • Pandora: Investors Should Be Patient [View article]
    @ Miketesla,

    I wish I had that data. Sadly I do not. What we do know is that P is trying to distinguish itself based on its service as a "passive" player of content. On the other hand, "on-demand" services like Spotify have a harder time justifying lower copyright payment rates to the CRB since a listener can "bypass" purchases by simply putting a song on "repeat" and listening to it whenever they want.

    Price paid out per stream from Pandora ranges from about 1/2 or 1/6th of what Spotify pays out, depending on the article you read.

    I guess one could "model" total revenue, and then try to figure out content costs by "guestimating" usage, but in the end, unless each company decides to open their books to the public, it will be a guess.

    At the end of the day though, my main point is that the differences between P's streaming model (passive radio) vs. Spotify's streaming model (on-demand) does have real "differences." The OP comment had argued that the differences were meaningless, which I don't agree with.

    At the end of the day, these differences are part of what make up the argument that P pitched to the CRB as a basis to keep its royalty payments at a lower rate. These are arguments that Spotify can't make - and ergo, that's why IMHO, the differences matter.
    Jul 25, 2015. 04:21 PM | Likes Like |Link to Comment
  • Pandora: Investors Should Be Patient [View article]
    I wouldn't necessarily say that the fact that they're not the same is meaningless. Some of the differences are what forms the basis for P's arguments about why its payment rates should be different. Sure - they're competitors, but from a business standpoint, if Spotify has to pay higher content costs while P's content costs are lower, well, from that perspective, that difference could be pretty significant.
    Jul 25, 2015. 12:47 AM | Likes Like |Link to Comment
  • What Questions Pandora Answered In The Second Quarter [View article]
    I dunno - I think there are plenty of positives that one could find in P's latest earnings report. Heck, if I had brain cancer, and found out it was in remission, I'd be pretty positive about that. Not saying that P is the next TSLA, FB, YELP (which I still think is a terrible business model), or similar kind of stock, but there are possibilities with P that seem very interesting right about now.
    Jul 24, 2015. 08:50 PM | 2 Likes Like |Link to Comment
  • What Questions Pandora Answered In The Second Quarter [View article]
    Brian - I think you hit the nail on the head with your analysis that P is finally leveraging data effectively. There are huge possibilities here.

    For example, if you're a sports bar in Philly, and want your ad to play after someone plays "Eye of the Tiger" - or another song in that genre, during football season, but only before an Eagles game - P has the ability to sell that ad slot. If you're a pharmaceutical company with a new depression drug, and you want your ad to play every time someone plays "yesterday - or another song in that genre, during the winter, right after Valentines day - P has the ability to sell that ad slot.

    Lots of companies have the ability to sell what they know about you. Very few companies know an emotion that you might be feeling, or trying to feel, better than P. At the end of the day, the kind of music one listens to, which has the potential to vary, depending on the situation, mood, etc. provides information that very other few companies have, and which very few other companies can replicate.

    More importantly, P can sell those ad slots for a premium, while also making that time affordable. Businesses can pay less overall by decreasing the volume they are advertising, but would likely be willing to pay more for the time they are advertising, so long as their ads are more targeted to the users they are trying to reach.

    Three things that I've been thinking of/had questions about are:

    1. How the rise of streaming internet video (sans advertisements), will impact P's ad revenue. With fewer folks watching "ad based TV," other venues like P, which has a very loyal listener base, should become much more valuable. Sure, a company can do things like market its product directly in the program you're watching on Netflix/Amazon Prime/Ad free Hulu - but there more than a few advertisers that can't do things like that because they need to explain a message.

    2. How the rise of "free" broadband will affect P's user base. One of P's major problems has been, is, and will be, the fact that its service is limited to folks who have internet connections. No internet connection - no P...and until everyone has free unlimited broadband, there will always be a place for free terrestrial ad based radio.

    3. How might original content change P? We saw what happened after NFLX started releasing original exclusive content. P has started down this path/direction with comedy features, and there has been talk about P original content with respect to "spoken word programming"

    But what I'm wondering about is what happens if/when P decides to start its on music label? I'm not even sure if this is possible, but assuming it is in the realm of possible, what happens when P starts leveraging its listener base, its data analytic capabilities, and its brand to musicians? Sure, it probably doesn't want to do that now because of the tension it would create between the company and existing music labels (along with all the reasons everybody said that NFLX wouldn't do it), but at the end of the day, what when you cut out the middle man, there is plenty of fat that P can keep for itself, plenty of ways for P to drive down content costs, and also would be a means to attract talent.

    In any case, good article. P still has lots of problems, and a lot of its future will depend on CRB rates - but the possibilities are out there. I'm interested to see how all this will turn out.
    Jul 24, 2015. 08:48 PM | 2 Likes Like |Link to Comment
  • Why Pandora Is Subject To A Further Downward Correction [View article]
    Lots of P shorts on SA...which is fine. Pandora has its flaws. Lets call a spade a spade though - and lets stop all the direct comparisons between it and other streaming music services.

    Pandora's focus is on free ad based streaming. It has a pay feature, but that's not its bread and butter. On the other hand, Google, Apple, and Spotify are all more focused and geared toward a subscription and pay model. Yes, P has a subscription service, and the other streaming services have free ad based services, but the focus of P is free ad based music (like FM stations) while the other streaming services have no real interest in trying to sell ads.

    Its similar to ad based TV vs. Netflix, or AM/FM ad based stations vs. Satellite pay based stations. Sure - they are competitors to some extent, but to characterize the other streaming services as a direct competitor to P is simply not accurate.

    All the talk about how competition is going to put P out of business is nonsense, the company is here to stay. Its profits will always be subject to question because it has no control over royalty payment which will fluctuate every few years. Once there is more certainty though and if P expands internationally there will be sirious growth potential.
    Jul 5, 2015. 08:31 PM | 3 Likes Like |Link to Comment
  • Twitter Gains Confirmation From Sell-Side Analysts [View article]
    So the author agrees with the analysis outlined by two other analysts who upgraded TWTR last week?
    Jun 5, 2014. 09:16 AM | 1 Like Like |Link to Comment
  • Twitter Gains Confirmation From Sell-Side Analysts [View article]
    @borisb - that assumes that the current twtr price is low. I'm in agreement with "22643611." TWTR's recent head of engineering "resignation" and the company's desperate "acquisition strategy" are the telltale signs of a company that is in turmoil.

    There will be better entry points in the future after next quarter's results and there is room for further deterioration in the company's stock price - especially once the "voluntary" insider restriction on stock sales ends.
    Jun 5, 2014. 09:15 AM | 3 Likes Like |Link to Comment
  • Netflix has dragons in its plans [View news story]
    No other competition appears to be coming?

    Yahoo and Microsoft are already starting up their streaming businesses.

    Companies like Apple and AT&T are in talks to potentially enter the market (e.g. Apple/Comcast talks; AT&T was rumored to be considering an acquisition of Hulu - and the recent acquisition of DISH might complement the acquisition of a streaming content provider).
    May 29, 2014. 03:42 PM | Likes Like |Link to Comment
  • Klarman raises alarm over asset prices, cites tech “nosebleed valuations” [View news story]
    Having "cut the cord" for two years to save money, I was a proud Netflix subscriber. I watched network TV through my digital tuner on my Sony Bravia flatscreen, and convinced myself that the buffered Netflix streaming movies that took hours to watch were fine, because in the end, I was saving at least $1k each year...

    And then I realized that Comcast was charging me more for my internet than what I would've been paying for the last six months had I opted to purchase both internet and cable from them...($65 a month for internet only vs. $59.95 a month for the double play bundle w/ no annual contract).

    Netflix will only last as long as Comcast and Verizon allow it to. The minute both of those companies make the decision to undercut Netflix on pricing, and as long as the law allows them to reduce the feeds of Netflix streams, Netflix won't stand a chance. Right now, Comcast is milking both Netflix and the consumers.

    Long story short = Comcast long and Netflix short.
    Mar 10, 2014. 11:22 PM | Likes Like |Link to Comment
  • Yelp: A Lone Reed, Standing Tall, Waving Boldly In The Corrupt Sands Of Competition? [View article]
    The valuation on YELP is insane. Investors who justify the valuation of the company by comparing YELP to AMZN, TSLA, and other companies that are seeing massive revenue growth are missing the point.

    YELP exists because it provides a useful service. Unfortunately those who use the service are not the same as prospective customers. There is a massive disconnect here. Even more unfortunate is the fact potential customers hate YELP.

    There is a reason why the company has not been acquired to date. The business model relies heavily on a sales force, who are expected to push services on a customer base that does not like the company.

    The stock price will crash...its just a matter of when, not if...
    Jul 13, 2013. 03:01 PM | Likes Like |Link to Comment