TIM685: Pandora Internet Radio Case Study
SECTION F General Issues in Strategic Management Industry One—Internet Companies Case 11 Pandora Internet Radio (2014): Just Press Play Gary Stenftennagel and Joyce Vincelette Introduction Brian McAndrews was quietly sitting at home listening to a mix of his favorite Pandora stations featuring Elton John, Billy Joel, the Rolling Stones, and Bruce Springsteen.1 He was putting together a company address to discuss Pandora’s recently released 2014 10-K filing and was contemplating the progress the company had made since his arrival. He thought back on the difficulties that the company presented when he joined as the new Chief Executive Officer (CEO) a few months prior. He had come into the role at a crucial time for the company. While Pandora was still experiencing rapid growth in users and listener hours, content acquisition costs were spiraling out of control because the music industry wanted their share of the profits, and listeners were willing to go elsewhere if the company did not offer the music they wanted. In addition, within a few days of being announced the new CEO, the competitive environment heated up considerably when Apple launched iTune Radio, supported by Apple’s international reputation and deep pockets. Mr. McAndrews knew that he and Pandora were in a tough spot. If Pandora could not control its costs, acquire the rights to music its listeners wanted, or attain profitability soon, how long could the company possibly survive? Pandora was built around the idea of providing listeners with only the music that they love. To do so, Pandora fundamentally changed how people listened to music by allowing station customization and the ability to listen to music over the Internet. As technology changed, Pandora evolved from a website-based radio provider and developed a mobile application with which the company could offer its services to customers whenever and wherever they wanted to listen to music. While monetizing the mobile product proved to be difficult and Pandora had not yet attained profitability, it looked like things had started to turn around for Mr. McAndrews and Pandora. By year-end 2013, Pandora’s advertising revenue per listener hour showed signs of increasing.2 Whether this was an anomaly or a positive sign for Pandora’s future was yet to be determined. As the company continued to evolve, the industry continued to develop, and competition continued to grow, Pandora had to adapt and change or risk being left behind. 11-1 Z11_WHEE5488_15_GE_CA11.indd 1 6/20/17 10:21 AM 11-2 C as e 1 1 Pandora Internet Radio (2014): Just Press Play History Pandora Internet Radio was founded in 2000 when founder Tim Westergren developed an initiative called the Music Genome Project.3 This project, which mirrored the major breakthroughs of the human genome project, sought to analyze and categorize music based on 450 musical characteristics.4 As the project grew, he realized that the extensive music database could be used to effectively target, categorize, and recommend music to listeners. He developed one of the smartest music recommendation programs available at the time. Within four years of the start of the project, Pandora Internet Radio was ready for its debut.5 With the leadership of Chief Executive Officer Joe Kennedy, who joined the company in July 2004, Pandora experienced rapid growth in users, streaming hours, and advertising clients during its early years.6 However, the road to success was rarely easy for Pandora as the small startup attempted to uproot the traditional radio industry. Pandora had to fight rising royalty costs, combat profitability issues, and attempt to change the status quo in the music industry. In February 2011, Pandora filed for an initial public offering (IPO).7 The company was able to leverage its ability to tailor music selections to its listeners’ music preferences. Pandora was soon at the forefront of music-oriented technology as the market for Internet radio started to develop. The growth in the company’s user base had been strong after the initial public offering in 2011. In January 2011, the company had 80 million registered users who listened to approximately 3.9 billion hours of radio by the year’s end.8 As of December 31, 2013, the company had more than 200 million registered users who listened to 15.31 billion hours of radio by year’s end.9 Within three years, the company had more than doubled its user base and almost quadrupled its listener hours. However, the company also experienced important changes in leadership with the departure of the company’s first CEO Joe Kennedy and the arrival of Brian McAndrews as the new CEO in September 2013. In addition, founder Tim Westergren, who served as Pandora’s Chief Strategy Officer, left the company in 2014.10 He continued to serve on Pandora’s Board of Directors. Pandora would miss the creative talents and vision of both departing executives who built the company. Mr. McAndrews certainly had large shoes to fill. By spring 2014, Pandora was the largest Internet radio provider in the United States. The company controlled approximately 70% of the Internet radio market and approximately 8.6% of the overall radio market.11 As the company grew, it expanded its product offerings through the development of a mobile application and integration with cars and other electronic devices. The company also increased its music offering from 800,000 tracks in 2011 to 1,000,000 tracks in 2013.12 The company had historically struggled with finances and as of December 31, 2013 had never achieved profitability as a public company.13 Despite the company’s lack of profitability, Pandora remained true to its mission and sought to provide users with only the music they love, whenever they want it, and wherever they want it. Corporate Governance Founder 14 Tim Westergren founded the online radio service in 2000 with the creation of the Music Genome Project and was the company’s Chief Strategy Officer until 2014.15 Prior to founding the company, Mr. Westergren worked in the music industry for over 20 years doing production, audio engineering, film scoring, and live performances. Mr. Westergren Z11_WHEE5488_15_GE_CA11.indd 2 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 11-3 continued to help develop Pandora’s strategy and vision and traveled the country to connect with Pandora’s vast number of listeners. Executive Officers 16 Brian McAndrews joined the company in September 2013 as Chief Executive Officer, President, and Chairman of the Board.17 Prior to joining the company, Mr. McAndrews was a venture partner at Madrona Venture Group. Mr. McAndrews was a Senior Vice President at Microsoft from August 2007 to December 2008 after the firm acquired aQuantive. Mr. McAndrews served as President and CEO of aQuantive from 1999 to 2007. He also worked for ABC, holding senior executive positions at ABC Sports, ABC Entertainment, and ABC Television Network, and as a product manager at General Mills. Mike Herring served as the Chief Financial Officer of Pandora since February 2013.18 Prior to joining the company, Mr. Herring was the Vice President of Operations at Adobe Systems Incorporated for three years. Mr. Herring was the Executive Vice President and Chief Financial Officer of Omniture Inc. between 2004 and 2009. He also served as Chief Financial Officer at Ancestry.com, Vice President of Finance at Third Age Media, and Controller at Anergen Inc. Delida Costin served as the General Counsel of Pandora. Prior to joining the company, Ms. Costin had a private legal practice and was a member of the Attorney Bench at Axiom Legal. Ms. Costin also served as the Vice President and Assistant General Counsel at CNET Networks. She also practiced with two law firms named Goodwin, Proctor LLP and Pillsbury Winthrop Shaw Pittman LLP. Simon Fleming-Wood served as the Chief Marketing Officer of Pandora since 2011. Prior to joining the company, Mr. Fleming-Wood was the Vice President of Marketing at Pure Digital Technology in charge of developing the Flip Video brand. When the brand was purchased by Cisco, Mr. Fleming-Wood assumed the role of Vice President of Marketing for the Cisco Consumer Products group. He also held senior marketing positions at Sega.com, Mattel, and The Clorox Company. Tom Conrad served as the interim Head of Product at Pandora. He was also the Chief Technology Officer of Pandora between 2004 and 2014. Prior to joining the company, Mr. Conrad was the Vice President of Engineering at Kenamea, Inc. He also served in various engineering positions at Berkeley Systems, Relevance Technologies, Documentum, Pets.com, and Kenamea. Mr. Conrad began his career at Apple Computer where he helped develop the Mac OS. John Trimble served as the Chief Revenue Officer of Pandora since March 2009.19 Prior to joining the company, Mr. Trimble was the Executive Vice President at Glam Media, Inc. Mr. Trimble also served on the executive team tasked with creating Fox Interactive Media and other brands. He has also held the roles of Director of Sales for SportsIllustrated.com and Vice President of Sales for Phase2 Media. Sara Clemens served as the Chief Strategy Officer of Pandora since February 2014. Prior to joining Pandora, she was an executive at Greylock Partners. Ms. Clemens was also a Vice President of Corporate Development at LinkedIn and an employee at Microsoft Corporation. Chris Martin served as the Chief Technology Officer of Pandora since March 2014.20 Prior to joining the company, Mr. Martin worked as an engineer at various companies such as Quintus, Kenamea, and QRS/Inovis. Kristen Robinson served as the Chief Human Resource Officer since March 2014. Prior to joining Pandora, Ms. Robinson held various roles at Yahoo, Hewlett-Packard, Agilent Technologies, and Verigy. Z11_WHEE5488_15_GE_CA11.indd 3 6/20/17 10:21 AM 11-4 C as e 1 1 Pandora Internet Radio (2014): Just Press Play Board of Directors 21 Tim Westergren co-founded Pandora in 2000, remained on the Board of Directors and had other limited roles at the company.22 Brian McAndrews joined the company in September 2013 as Chief Executive Officer, President, and Chairman of the Board. Peter Chernin joined the Board of Directors in January 2011. He was the owner of Chernin Entertainment and The Chernin Group, which both focus on media and entertainment initiatives. Prior to joining the company, Mr. Chernin held various positions at News Corporation from 1996 to 2009 such as Chief Executive Officer of Fox Entertainment Group and the head of Twentieth Century Fox Filmed Entertainment and Fox Broadcasting Company. He also served on the Board of Directors at American Express. Peter Gotcher joined the Board of Directors in September 2005. He was a private investor and venture partner with Redpoint Ventures from 1999 to 2002. Mr. Gotcher was also a partner at Institutional Venture Partners, founder of Digidesign, and Executive Vice President at Avid Technology. He also served on the Board of Directors of Dolby Laboratories. Robert Kavner joined the Board of Directors in March 2004. He was an independent investor and served as President and Chief Executive Officer of On Command Corporation. Mr. Kavner also held senior management roles at AT&T and AT&T Venture Capital Group. He was also a partner at PricewaterhouseCoopers before joining AT&T. Elizabeth Nelson joined the Board of Directors in 2013. She was the Executive Vice President and Chief Financial Officer at Macromedia, Inc. Ms. Nelson also held finance and corporate development roles at Hewlett-Packard Company. She also served on the Board of Directors of Nokia, Ancestry.com, CNET Networks, Inc., and other companies. David Sze joined the Board of Directors in May 2009. Mr. Sze was a partner at Greylock Partners, where he focused on Internet and technology investments. Before joining Greylock Partners, he worked at Excite, Electronic Arts, HBO, and Crystal Dynamics. He started his career at The Boston Consulting Group and Marakon Associates. Mr. Sze also served on the Board of Directors of LinkedIn Corporation. James Feuille joined the Board of Directors in October 2005. He was a partner at Crosslink Capital where he focused on technology-based investments. Prior to joining Crosslink Capital, Mr. Feuille held roles at UBS, Volpe Brown Whelan & Company, and Robertson Stephens & Company. Mission, Objectives, And Strategies Pandora was originally developed to bring the joy and power of music to everyone, everywhere, anytime. This idea, which started with Tim Westergren’s development of the Music Genome Project, continued to shape the company’s mission and business through the years. Pandora’s strategies and business model supported the company’s mission, which was outlined in the company’s initial SEC filing in 2011. “Our mission is to enrich people’s lives by enabling them to enjoy music they know and discover music they’ll love, anytime, anywhere. People connect with music on a fundamentally personal and deeply emotional level. Whether it’s a song someone first heard ten years ago or one they’ve just discovered, if they connect with that music on our service, a strong bond is forged at that moment with Pandora. Just as we value music, we also hold a deep respect for those who create it. We celebrate and hold dear the individuals who have chosen to make music, from megastars to talented new and emerging artists.”23 This original mission Z11_WHEE5488_15_GE_CA11.indd 4 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 11-5 statement had been embodied within Pandora’s subsequent mission statements as they evolved over the years, “To play only music you’ll love.”24 The company recognized how powerful music could be in a person’s life. Accordingly, the company continued to strive to increase the size of its music library, improve music recommendations, widen the availability of its service, and make the service seamless and easy to use. Pandora also wanted to grow as a company, increase its user base, and generate revenue, all while minimizing costs. Only by accomplishing its objectives would the company be able to achieve its mission. Pandora developed key strategies to support the company’s objectives. These strategies outlined how the company would expand, improve, and continue to deliver music to millions of people. The first strategy was to widen the availability of its service and “make Pandora available everywhere that there is Internet connectivity.”25 This demonstrated the company’s desire to expand geographically and increase the number of devices on which the product was offered. The second strategy was to transform listener hours into revenue through advertisement sales. “Our advertising strategy focuses on developing our core suite of audio, display and video advertising products and marketing these products to advertisers for delivery across traditional computer and mobile and other connected device platforms.”26 The company was trying to provide the most comprehensive advertising suite at competitive rates to both gain new partners and retain old ones. The third strategy focused on growth and financial stability. Pandora sought to “increase the number of listeners and listener hours to increase our market penetration, including the number of listener hours on mobile and other connected devices.”27 In addition to increasing revenue, the company sought to curb content acquisition costs and increase financial stability. The fourth strategy was a long-term plan to expand internationally in order to increase the company’s user base and diversify revenue.28 According to Pandora, international expansion was cost prohibitive.29 The fifth and last strategy was to better compete with traditional radio for advertising revenue.30 Pandora was trying to better position itself to court advertising partners and to actively pursue revenue growth. Marketing Product Pandora offered two main products. The first product was the free advertising-supported radio service which launched in 2005.31 The free alternative was funded through webbased advertisements that appeared intermittently during listening. Pandora sales representatives sold advertisement slots to various companies. The revenue collected from advertisers enabled the company to provide the free streaming service. To use the free alternative, customers only needed to create an account, input personal data, and get started. Based on the personal data and other metrics, advertisements were targeted and user-specific.32 The second product Pandora offered was called Pandora One. Pandora One was a subscription-based alternative that offered advertisement-free radio for a fee. When individuals purchased this plan, they experienced seamless and uninterrupted music streaming. Both products were offered on a variety of platforms that were broken up into two main categories: computer focused or mobile oriented.33 Users could access Pandora’s website through any Internet-enabled computer. The mobile application relied on wireless data or Wi-Fi to function. People could use the product around the house, on the Z11_WHEE5488_15_GE_CA11.indd 5 6/20/17 10:21 AM 11-6 C as e 1 1 Pandora Internet Radio (2014): Just Press Play road, or anywhere else they had an Internet connection. This functionality fit in nicely with Pandora’s strategy to provide its service to users any place or anytime. The company’s product offerings had gone through many changes over the years including the removal of listening limits on free mobile radio. Early on, a listening limit of 40 hours per month was implemented and if listeners exceeded the 40 hour per month listening limit, they had the opportunity to pay $0.99 to get unlimited streaming for the rest of the month.34 As of September 2013, the company removed the listening cap due to bad publicity.35 Pandora’s business model was focused on the sale of advertisements delivered to users of the company’s free service and from subscription revenue from Pandora One. Pandora made the majority of its revenue from the sale of advertisements delivered in audio, display, and video format.36 The company offered advertisements to local and national advertisers and provided targeted advertisements based on attributes such as age, gender, zip code, and other preferences.37 In order to sell advertisement slots to advertisers, the company employed a large sales force to help maintain established clients and recruit new ones. The company’s sales force was divided into multiple geographic teams located in California, Illinois, and New York.38 Advertisements were intermittently shown to users of the free Pandora website and mobile application. Pandora then received revenue for each user listening hour that it registered. In order to quantify the revenue, Pandora developed a metric called Advertising Revenue per Thousand Listener Hours. According to the company’s financial filings, one thousand listener hours was worth $29.60 in 2012 and $36.70 in 2013 in advertising revenue.39 The business model was essentially based on the number of listener hours and the revenue per listening hour generated. If Pandora wanted to generate additional revenue, the company had to increase the number of listener hours or increase its revenue rate per hour. Pandora also generated revenue through the monthly subscription fee it charged Pandora One subscribers. The Pandora One subscription allowed users to listen to unlimited advertisement-free content.40 However, with only 3.3 million subscribers, the subscription-based service only made up a fraction of the company’s overall revenue, 12% in 2012 and 18% in 2013.41 Pandora One revenue was dependent on the fee charged for the paid service and the number of customers paying for the service. Price Pandora had different pricing schemes for its products. The free Internet radio was subsidized by revenue from advertisement sales. By charging companies for advertising slots, the company was able to offer its free service. This was an attractive product from a consumer’s perspective, which was evident in the fact that the majority of Pandora’s users were free listeners. In the 11 months ended December 31, 2012 and 2013, 88% and 82% of the company’s revenues, respectively, came from advertisement sales.42 Pandora One was a paid service that, for a small monthly fee, granted customers access to advertisement-free listening.43 However, due to the popularity of the free alternative, Pandora One only made up a fraction of the company’s overall revenue. The percentage of the company’s revenue attributable to Pandora One in the 11 months ended December 31, 2012 and 2013 was 12% and 18%, respectively.44 Place Pandora was founded in the United States and grew quickly domestically. The company had become a prominent brand in the United States and was seen as a leader in Internet radio. However, Pandora had no international presence and international expansion was Z11_WHEE5488_15_GE_CA11.indd 6 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 11-7 cost prohibitive. Pandora had licensing agreements in place with music rights organizations in the United States. United States copyright laws allowed Pandora to distribute the media domestically but not internationally. Ultimately, this limited P andora’s expansion possibilities. The difficulty of comprehending and the costs associated with international copyright laws had stalled Pandora’s international expansion efforts. Promotion In order to promote its product, Pandora relied heavily on two forms of free promotion, word of mouth and product integration. As of December 31, 2013, Pandora had 76.2 million monthly active members that used its product.45 Accordingly, Pandora counted on its current members to inform friends and family about its product. With so many active members, everyone knew someone who used Pandora. With this degree of market penetration, Pandora had decided not to spend on promotion. Pandora was also integrated with cars, televisions, and many other consumer electronics.46 Car and electronic manufacturers were using Pandora integration as a selling point to draw in potential buyers. As a result, Pandora integration was being promoted at the expense of its partnering companies. Due to the costs involved, Pandora did not produce or air commercials to promote its brand, new features, or new pricing schemes. Finance In 2013, Pandora changed its fiscal year to align with the calendar 12 months beginning January 1st and ending December 31st, effective beginning with the year ended December 31, 2013.47 As a result, Pandora’s financial statements are presented on both an 11-month basis from January 31, 2013 to December 31, 2013 and on a 12-month basis from January 31, 2013 to January 31, 2014. Pandora’s income statement and consolidated balance sheet are provided in Exhibit 1 and Exhibit 2, respectively. As shown in Exhibit 1, Pandora reported an increase in total revenue from $389.484 million for the 11 months ended December 31, 2012 to $600.233 million for the 11 months ended December 31, 2013, which was a 54% increase. Revenue at Pandora was derived from two significant sources: advertising and subscriptions. Advertising revenue made up the majority of Pandora’s revenue. Between the 11 months ended December 31, 2012 and 2013, advertising revenue increased 43% from $343.318 million to $489.340 million while subscription revenue increased 140% from $46.166 million to $110.893 million, as shown in Exhibit 1. Despite the rapid growth in revenue, the company had yet to experience profitability due to rising content acquisition costs and sales and marketing expenses. In order to provide its service, Pandora had to develop licensing agreements with music companies. As the music industry continued to evolve, music rights owners were looking to make more money from licensing agreements. Pandora felt this extra burden as its content acquisition costs continued to rise. As shown in Exhibit 1, Pandora reported content acquisition costs of $314.866 million in the 11 months ended December 31, 2013, a 36% increase over the 11 months ended December 31, 2012. These rising costs were constantly an issue for Pandora as the company continued to struggle with profitability. Sales and marketing expenses were also very high. In order to increase advertising revenue, the company had to sell advertisements to advertisers. To do so, Pandora employed a very large sales team across the country. The team was in charge of bringing in all of the company’s advertising revenue. As shown in Exhibit 1, Pandora Z11_WHEE5488_15_GE_CA11.indd 7 6/20/17 10:21 AM 11-8 C as e 1 1 Pandora Internet Radio (2014): Just Press Play EXHIBIT 1 Pandora Internet Radio Consolidated Statement of Operations (All figures in thousands except per share data) Twelve Months Ended January 31 Eleven Months Ended December 31 2013 (b) 2012 (b) 2011 (a) 2010 (a) 2013 (b) 2012 (b) 375,218 51,927 239,957 34,383 119,333 18,431 50,147 5,042 489,340 110,893 343,318 46,166 Total revenue 427,145 Cost of revenue 258,748 Cost of revenue Content acquisition costs Cost fo revenue – Other 32,019 274,340 137,764 55,189 600,233 389,484 148,708 69,357 32,946 314,866 230,731 22,759 11,559 7,892 41,844 28,740 Total cost of revenue 290,767 171,467 80,916 40,838 356,710 259,471 Gross profit Operating expenses Product development Sales and marketing General and administrative Total operating expenses 136,378 102,873 56,848 14,351 243,523 130,013 18,118 107,715 48,247 13,425 65,010 35,428 6,736 36,250 14,183 6,026 17,426 6,358 29,986 169,774 70,212 16,191 94,566 43,320 174,080 113,863 57,169 29,810 269,972 154,077 Loss from operations Other expense (37,702) (441) (10,990) (5,042) (321) (1,309) (15,459) (1,294) (26,449) (474) (24,064) (401) Loss before income taxes (38,143) Income tax benefit (5) (expense) (38,148) Net loss (16,032) (75) (1,630) (134) (16,753) – (26,923) (94) (24,465) 3 (16,107) (1,764) (16,753) (27,017) (24,462) Deemed dividend on Series D and Series E Accretion of redeemable convertible preferred stock Increase in cumulative dividends payable on conversion of liquidation of redeemable convertible preferred stock Net loss attributable to (38,148) common stockholders Net loss per share, basic (0.23) and diluted Notes: – – (1,443) – – (110) (300) (218) – – (3,648) (8,978) (6,461) – – (19,865) (11,042) (24,875) (27,017) (24,462) (0.19) (1.03) (3.84) (0.15) (0.15) Revenue Advertising Subscription and other (a) Pandora Internet Radio 2012 10-K, p. 60. (b) Pandora Internet Radio 2014 10-K, p. 74. reported sales and marketing expenses of $169.774 million in the 11 months ended December 31, 2013, an 80% increase over the 11 months ended December 31, 2012. Between the 11 months ended December 31, 2012 and 2013, sales and marketing increased by 80% while advertising revenue increased only 43%. Z11_WHEE5488_15_GE_CA11.indd 8 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 11-9 EXHIBIT 2 Pandora Internet Radio Consolidated Balance Sheets (All figures in thousands except share data) As of January 31, As of January 31, As of January 31, 2013 (b) 2012 (a) 2011 (a) Assets Current Assets Cash and cash equivalents Short-term investments Accounts receivable, net of allowance Prepaid expenses and other current assets Total current assets Long-term investments Property and equipment, net Other long-term assets Total assets Liabilities and stockholders’ equity Current liabilities: Accounts payable Accrued liabilities Accrued royalties Deferred revenue Accrued compensation Current portion of long-term debt Total current liabilities Long-term debt Preferred stock warrant liability Other long-term liabilities Total liabilities Redeemable convertible preferred stock Stockholders’ equity: Preferred Stock, $0.0001 par value Common stock, $0.0001 par value Additional paid-in capital Accumulated deficit Accumulated other comprehensive loss Total stockholders’ equity Total liabilities and stockholders’ equity As of December 31, 2013 (b) 65,725 23,247 103,410 44,126 46,455 66,738 43,048 42,212 2,45,755 98,662 1,64,023 6,232 2,806 3,516 10,343 198,614 17,758 2,460 218,832 160,125 15,576 2,314 178,015 88,776 8,683 1,750 99,209 5,18,783 105,686 35,151 13,715 673,335 4,471 7,590 53,083 29,266 21,560 2,053 3,838 33,822 19,232 11,962 1,965 5,532 18,080 15,910 3,815 6,759 14,413 14,885 66,110 42,650 17,948 115,970 70,907 156,006 3,873 119,843 2,568 73,475 52,061 837 1,027 1,632 55,557 126,662 17 16 1 20 238,552 (139,574) (6) 205,955 (101,426) (5) 2,308 (85,319) – 675,103 (166,591) (301) 98,989 218,832 104,540 178,015 (83,010) 99,209 508,231 673,335 9,098 165,104 Notes: (a) Pandora Internet Radio 2012 10-K, p. 59. (b) Pandora Internet Radio 2014 10-K, p. 73. Z11_WHEE5488_15_GE_CA11.indd 9 6/20/17 10:21 AM 11-10 C as e 1 1 Pandora Internet Radio (2014): Just Press Play Content acquisition costs and sales and marketing expenses were the most significant costs for Pandora. In 2013, they combined to total $484.640 million, as shown in Exhibit 1. These costs were approximately 81% of the total revenue of the company. As a result, the company had not achieved profitability since its IPO in 2011. The company’s struggle for profitability was evident in the fact that it had a net loss in both the 11 months ended December 31, 2012 and 2013. In the 11 months ended December 31, 2013, the company reported a net loss attributable to common stockholders of $27.017 million, compared to a loss of $24.462 million in the 11 months ended December 31, 2012, which can be seen in Exhibit 1. Growth As one of the first companies in the Internet radio market, Pandora initially experienced rapid growth. As with other disruptive technologies, the company took market share from established market leaders. In this case, Pandora grew at the expense of traditional radio as the new technology, which allowed people to listen to radio on the Internet, started to catch on and grow. However, growth opportunities had slowed as the Internet radio market had become saturated with competitors. In order to continue growing, the company had to increase its user base. A few different opportunities such as international expansion and partnerships had been discussed to help spur new growth. Pandora was almost solely based in the United States. Besides small operations in Australia, Pandora had no international operations. This was mainly the result of complex copyright and licensing laws that did not transfer between countries. As a result, if Pandora wanted to expand internationally, the company would have to negotiate new contracts to stream music to each country individually. Because of this, the cost to expand internationally was extremely high and Pandora had to weigh the costs and benefits of such expansion. One of Pandora’s newest growth initiatives was collaborating with automobile makers and other electronic device makers to integrate the company’s service with their products. This initiative, called Pandora Everywhere, focused on providing Internet radio to listeners at home, in the car, and everywhere in between.48 In order to capitalize on the fact that Americans spend a lot of time traveling by car, one of the main initiatives of Pandora Everywhere was automobile integration. Pandora had integrated its product with car manufacturers such as BMW, Buick, General Motors, Ford, GMC, and many others.49 This initiative also helped take away listeners from one of the company’s largest competitors, traditional radio. To further increase listening in the car, Pandora collaborated with aftermarket stereo companies such as Pioneer and Sony.50 Aftermarket stereos are replacement stereos that usually are placed in older or outdated cars. To further become part of the everyday lives of consumers, Pandora was also integrating its service with household appliances, home theater systems, televisions, and a variety of other home electronic devices. Partnerships with Samsung, LG, Sharp, Philips, and other companies increased the company’s exposure to new potential listeners.51 These strategic partnerships were being formed to both increase the number of individuals who used Pandora and to increase the total number of listening hours. The partnerships helped the company create an easy-to-use product that was available anywhere, on any device, and anytime listeners wanted. The ability to access and use Pandora anytime and anywhere was the purpose of Pandora’s strategic partnerships. Pandora understood that simplicity of use and constant Z11_WHEE5488_15_GE_CA11.indd 10 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 11-11 availability of its service was the key to the company becoming the go-to entertainment solution of the future. Legal Landscape The music and technology industries had extremely complex legal landscapes. Music licensing was a costly and complicated process but was essential for Pandora to provide its service. The domestic and international music rights laws varied dramatically and presented their own set of issues. Privacy issues and patent disputes could also arise and present legal and financial troubles for companies like Pandora. Music Licensing High content streaming acquisition costs were a serious issue for Pandora. Once upon a time the music industry generated revenue by selling CDs and MP3s to fans. As consumers moved toward cheaper and more accessible alternatives, such as Internet radio, record labels attempted to offset declining CD and MP3 sales by increasing the cost to stream music. Music rights owners had significant bargaining power when negotiating rates because without content, companies like Pandora would be unable to survive. This disproportionate bargaining power was evident in the constantly rising content acquisition costs that crippled Pandora. In order to track licensing costs, Pandora published a statistic called licensing costs per thousand listener hours (LPMs). In the 11 months ended December 31, 2012, the LPMs was $18.30.52 In 2013 the costs rose over 12% to $20.57.53 These rising costs had become increasingly problematic for Pandora and the company sought to do a better job of managing costs and monetizing its service. Domestic versus International Law Pandora offered its services almost exclusively in the United States and, as a result, was only required to comply with domestic copyright laws. The United States had one of the most developed and complete set of licensing laws in the world. While acquiring streaming rights was extremely expensive domestically, it would be much more difficult internationally. According to Pandora, there were no equivalent laws outside of the United States and other licensing alternatives were not commercially viable.54 The international landscape was far more complex and decentralized. Pandora would have had to expend substantial time and capital to expand internationally and negotiate the necessary streaming contracts in each country. Lawsuits Pandora’s lawyers also had to address legal issues concerning privacy and patent infringement because these laws were continuously changing in the United States. While Pandora did everything it could to comply with privacy laws, the company had faced legal action twice over privacy concerns. The first class action lawsuit alleged the company unlawfully accessed and transmitted personal identifiable information in connection with the use of the company’s Android application.55 The second lawsuit claimed Pandora allowed a listener’s history to be visible to the public.56 These lawsuits could be Z11_WHEE5488_15_GE_CA11.indd 11 6/20/17 10:21 AM 11-12 C as e 1 1 Pandora Internet Radio (2014): Just Press Play costly for Pandora. As of December 31, 2013, no ruling had been passed for either lawsuit. Pandora also dealt with lawsuits where other companies claimed Pandora infringed on their patents. Pandora had been sued by B.E. Technology, LLC, 1st Technology LLC, and Macrosolve, Inc.57 As of December 31, 2013, no ruling had been reached on the the B.E. Technology, LLC lawsuit. The 1st Technology LLC lawsuit was settled, and the Macrosolve, Inc. lawsuit was dismissed.58 Intellectual Property A combination of intellectual property rights including copyrights, trademarks, patents, contractual restrictions, and non-disclosure agreements helped protect Pandora’s service and brand.59 Internet-oriented companies usually put strict measures in place to protect their intellectual property. This was particularly important because copying ideas and services had become much easier since the advent of the Internet. For example, Pandora could suffer significant damage to its intellectual property, such as its music recommendation software and Music Genome Project, if a competitor or hacker gained access to the company’s computer code. Accordingly, Pandora had eight patents and purchased additional patents from other technology companies.60 In addition, in order to protect its name and image, Pandora obtained registered trademarks and domain name rights in the United States and at least nine other countries.61 The trademark protects the Pandora name, the Music Genome Project, and additional Pandora logos.62 Pandora also owned Internet domain names for its website at Pandora.com. In addition, if Pandora decided to expand internationally, the company owned additional domain names for Pandora in the United Kingdom, Germany, New Zealand, and India.63 Despite the company’s greatest efforts to protect itself from copycats, the protection of copyrights, trademarks, and patents was only as strong as the country’s laws in which it operated. Contractual restrictions and non-disclosure agreements also helped limit the potential negative impact of other companies poaching Pandora employees. Industry/Competitors Internet radio as a way to listen to music was a new concept when Pandora was founded and few competitors existed. As the technology landscape changed and with the increased prevalence of the Internet and Internet-connected devices, the age of Internet radio was poised to take over traditional radio. People sought out free and easy-to-use alternatives when listening to music with more customization features and fewer advertisements. As a result of the increasing market desire for Internet radio, competitors emerged in the United States as well as internationally offering both advertisementbased free Internet radio and advertisement-free subscription services. While competition was strong among Internet radio companies, Pandora also faced competition from traditional radio providers and satellite radio providers. Pandora’s competitors could be broken up into three groups, traditional radio, satellite radio, and Internet radio.64 Traditional radio was a large and established market with well-defined competitors. Traditional radio was first utilized to air a musical performance in 1907.65 Traditional table radios soon became integrated into everyday life, eventually becoming the staple form of entertainment in homes before the advent of television and eventually becoming the most common type of radio available in automobiles. Traditional radio stations offered relatively established content including music and talk stations with Z11_WHEE5488_15_GE_CA11.indd 12 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 11-13 no customization options. It was a free service but had become outdated as seemingly better alternatives had come to fruition. On average, traditional radio stations aired between 10 and 22 minutes of audio advertisements per hour, which was significantly higher than Pandora.66 The main satellite radio provider was SiriusXM. SiriusXM was a subscriptionbased satellite radio service that provided advertisement-free music, sports, comedy, news, weather, and more for a monthly cost between $9.99 and $18.99 per month. 67 There were no free versions available. SiriusXM was the largest radio broadcaster measured by revenue in 2014.68 The company had approximately 25.8 million subscribers.69 SiriusXM was available through a mobile application, dedicated SiriusXM devices, and in-car radios. The company had partnerships with all the major automobile manufacturers and was integrated with many of their vehicle offerings. Many Internet radio companies provided advertisement-free subscriptions at a much lower price point than SiriusXM but lacked the diversity of channel offerings, such as sports radio. Satellite radio was created as an alternative to traditional radio and preceded the creation of Internet radio. The Internet radio market had many new and established competitors. Some of the most well-established and well-known services were Spotify and iTunes Radio. These competitors offered free listening alternatives with different options for online versus mobile listening, in different geographical locations, and had drastically different market shares. Pandora commanded a large market share in the United States, with approximately 70% of the Internet radio market share.70 The company also had 8.6% of the total U. S. radio market making it the largest radio station in most major markets.71 However, the market had continuously evolved and market share constantly changed. Spotify was founded in Sweden in 2006.72 The company quickly expanded and its European presence, in particular, grew. Due to the popularity of its service, Spotify started to offer services in the United States in 2011.73 The company offered both an advertisement-based free service and an advertisement-free subscription service. This company was very similar to Pandora but also offered the ability to create playlists, listen to individual songs, and listen to top lists, in addition to its radio feature. It was also much more developed and recognized internationally. The company was still expanding internationally and looking to solidify its position in the U. S. market. iTunes Radio was released by Apple Inc. on September 18, 2013 and was a small part of one of the largest and well-known companies in the world. 74 Accordingly, iTunes Radio had the capital and manpower necessary to succeed. iTunes Radio was an advertisement-based free radio service with a subscription-based advertisementfree alternative. The service was an expansion of the iTunes platform, which was the largest music retailer in the world.75 While the service was new, Apple’s experience in the music industry made it a significant threat and competitor. In 2013, iTunes was available in over 100 countries worldwide.76 The company’s international presence had allowed Apple to expand its service much quicker than Pandora because of its pre-established name brand and knowledge of international music regulations. See Exhibit 3 for a comparison of competitors’ cost (free or paid) and features in further detail. Pandora also had numerous competitors in the sale of advertisements such as Facebook, Google, Yahoo!, CBS, FOX, the Wall Street Journal, and traditional radio.81 Pandora had to compete based on the effectiveness of the company’s advertisements, pricing structure, return on investment to customers, and other criteria. These companies selling advertisements ranged in size but were generally well-established companies in Z11_WHEE5488_15_GE_CA11.indd 13 6/20/17 10:21 AM 11-14 C as e 1 1 Pandora Internet Radio (2014): Just Press Play EXHIBIT 3 Comparison of Competitors’ Cost and Features Service Cost Where Available Pandora 77 Traditional SiriusXM 78 Spotify79 iTunes Radio 80 Free or Paid Free Paid Free or Paid Free or Paid Mainly the United States Domestic and International Mainly the United States Domestic and International Mainly the United States their respective industries. In addition, with the increase of Internet-based startups, the advertising market had become increasingly competitive as new companies contended for advertising revenue. Computer Vs. Mobile When Pandora was founded, the traditional computer market was booming. The main source of Internet usage was from traditional desktop or laptop computers. To target this audience, Pandora developed its Internet radio for use on the computer. Individuals accessed the service through a website. In recent years, the emergence of mobile technology had a tremendous impact on the company’s service. Individuals no longer looked to stream music while sitting down at their computer or laptop. Individuals increasingly looked to go mobile and wanted to have access to their music and technology on the road. To capture this changing market, Pandora created a mobile application available on multiple phone operating systems such as iOS and Android. This transition happened rather rapidly and was spurred on by the introduction of the original iPhone. The transition to mobile computing had major implications on Pandora’s revenue stream. When Pandora was created, its advertisement-funded free Internet radio was developed with traditional computing in mind. The company’s visual and audio advertisements were tailored to traditional computers and were very lucrative. In the 11 months ended December 31, 2013, traditional computers had advertising revenue per thousand listener hours of $56.79.82 This was up from $54.51 in 2012.83 In comparison, mobile computing had advertising revenue per thousand listener hours of $31.97 and $22.80 for 2013 and 2012, respectively.84 A comparison of the different rates is presented in Exhibit 4. Advertisers were less likely to pay for mobile advertisements because listeners paid less attention to the ads and the types of advertisements on EXHIBIT 4 Comparison of Advertising Revenue per Thousand Listener Hours Eleven months ended December 31, 2012 Eleven months ended December 31, 2013 $29.60 $54.51 $22.80 $36.70 $56.79 $31.97 Total Ad RPMs Traditional Computer Mobile and Other Connected Devices Source: Pandora 2013 10-K, p. 44. Z11_WHEE5488_15_GE_CA11.indd 14 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 11-15 mobile devices were limited. As a result, mobile advertisements had a lower rate of advertising revenue per thousand listener hours. The difference was dramatic. Traditional computer advertisements were between 2.5 and three times as valuable to Pandora as their mobile counterparts. As consumers listened to more and more music on their mobile devices, Pandora’s advertising revenue per thousand listener hours was expected to decline further. In order to stabilize future revenue, the company had to look for ways to increase advertising revenue and better monetize mobile advertisements. Technology Changing Technology Pandora was developed based on the Music Genome Project that Tim Westergren founded back in 2000. The Music Genome Project started out as an initiative to categorize songs based on musical characteristics. After trained musical analysts characterized the music, the data could be used to help predict user preferences based on similar song choices and allowed Pandora to respond to their tastes. This technology gave Pandora a competitive advantage over its rivals. However, as with all technology, competitors began catching up and Pandora’s competitive advantage began to erode. To combat this, Pandora must continue to explore new technological innovations to remain at the forefront of Internet radio technology. Although the company was still a leader in Internet radio and music recommendation software, it had not adapted to other new technologies and business models. One of the major changes in music streaming technology was the ability to both create radio stations and pick individual songs to play. Pandora lacked the ability for users to listen to individual songs from the company’s extensive music database. On Pandora you could only create radio stations based on genres or artists. There was no feature to listen to specific songs or to add them to a playlist. Spotify offered radio stations and the ability to search and play specific songs from their music library. This difference in technology and service had quickly become a differentiating factor for Spotify and because of customer demand for this service Spotify gained market share quickly.85 Whether Pandora lacked these features because of a shortage of technological development or because of a restriction on Pandora’s content streaming agreements was unknown. Pandora was investing in its product and technology development, which was evident in the $16.191 million spent in the 11 months ended December 31, 2012 and the $29.986 million spent in the 11 months ended December 31, 2013 on product development.86 Continued research and development might deliver the spark the company needed to eventually achieve profitability. Service Compatibility In addition to developing new features desired by music listeners, Pandora also had to continue to make its technology compatible with advances in listening devices, including mobile devices, consumer electronic products, and automobiles. If Pandora’s services did not work on all of the new devices, the company risked losing customers to competing services. In order to maintain compatibility, Pandora worked with the company’s thirdparty distribution partners on creating compatible technology.87 This could become increasingly more expensive with an increase in the number of devices supported by Pandora. Z11_WHEE5488_15_GE_CA11.indd 15 6/20/17 10:21 AM 11-16 C as e 1 1 Pandora Internet Radio (2014): Just Press Play Future Outlook Although Pandora was less than two decades old, the company’s technology and business model had revolutionized the way people listened to music. Gone were the days when people predominantly bought music and listened to CDs and MP3s. With the invention of Internet-enabled devices such as smart phones, technology changed music listening habits and Pandora capitalized on this opportunity. However, the entrenched music industry was not easy to combat. Music rights owners still wanted to be paid. As a result, Pandora endured rising content acquisition costs as music companies searched for new ways to make money. Pandora, although successful in creating a platform and business that delivered Internet radio, had done a poor job of managing these rising costs and lacked financial stability. Years after helping revolutionize the music industry, Pandora risked losing out to established competitors and new market entrants. Companies such as Spotify and iTunes Radio were beginning to develop an American audience and could dethrone Pandora as they offered Internet radio with innovative new features and name brand recognition. If Pandora does not effectively manage its rising costs, find ways to diversify its revenue streams, and outpace its competitors with service offerings demanded by its customers, the company might find itself becoming as obsolete as the cassettes and CDs of old. As Steve Jobs once said about revolutionizing the music industry with the opening of the iTunes Music Store, “It will go down in history as a turning point for the music industry. This is landmark stuff. I can’t overestimate it!”88 The music industry might be on the verge of this transformation once more. Pandora needs to plan for the future in order to stay relevant and profitable in this changing industry. NOTES 1. Web, August 2, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-govBio&ID=212382 2. Pandora, 2014 10K, p. 46. Web August 2, 2015 http://investor .pandora.com/phoenix.zhtml?c=227956&p=proxy 3. Web, August 2, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-govBio&ID=212488 4. Web, August 3, 2015 https://www.pandora.com/about/mgp 5. Web, August 5, 2015 http://thinkofthat.net/2010/02/17 /the-story-of-pandora-radio/ 6. Web, August 2, 2015 http://techcrunch.com/2013/03/07 /pandoras-long-time-ceo-joe-kennedy-abruptly-steps -down-just-as-pandora-starts-making-money-on-mobile/ 7. Web, August 5, 2015 http://www.sec.gov/Archives/edgar /data/1230276/000119312511032963/ds1.htm 8. Web, August 2, 2015 http://quote.morningstar.com/stock -filing/Registration/2011/2/11/t.aspx?t=XNYS:P&ft=S-1&d=8 43511d53f8f977b8241a44e2b11cce9 9. Pandora, 2014 10K, p. 3. Web August 2, 2015 http://investor .pandora.com/phoenix.zhtml?c=227956&p=proxy 10. Web, August 2, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-newsArticle&ID=1853983, http:// www.nytimes.com/2014/03/19/business/media/top-technology -officer-at-pandora-steps-down.html?_r=0 11. Web, August 5, 2015 Pandora, 2014 Annual Report, p. 5, Pandora, 2014 Annual Report, p. 41. 12. Web, August 5, 2015 http://www.sec.gov/Archives/edgar /data/1230276/000119312511032963/ds1.htm, p. 1, Pandora, 2013 10K p. 3. Z11_WHEE5488_15_GE_CA11.indd 16 13. Pandora, 2014 10K, p. 63. Web August 2, 2015 http://investor .pandora.com/phoenix.zhtml?c=227956&p=proxy 14. Web, August 5, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-govBio&ID=212488 15. Web, August 5, 2015 http://www.nytimes.com/2014/03/19/ business/media/top-technology-officer-at-pandora-stepsdown.html?_r=0 16. Web, August 5, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-govManage 17. Web, August 5, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-newsArticle&ID=1853983 18. Web, August 11, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-newsArticle&id=1780880 19. Web, August 11, 2015 http://investing.businessweek.com /research/stocks/people/person.asp?personId=38323298& ticker=P 20. Web, August 12, 2015 http://investor.pandora.com /phoenix.zhtml?c=227956&p=irol-newsArticle&ID= 1909735&highlight= 21. Web, August 12, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-govBoard 22. Web, August 12, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-newsArticle&ID=1853983 23. Web, August 11, 2015 http://www.sec.gov/Archives/edgar /data/1230276/000119312511032963/ds1.htm, p. 1. 24. Web, August 11, 2015 http://www.pandora.com/about 25. Pandora, 2014 10K, p. 42. Web August 21, 2015 http://investor .pandora.com/phoenix.zhtml?c=227956&p=proxy 6/20/17 10:21 AM Ca se 11 Pandora Internet Radio (2014): Just Press Play 26. Ibid., p. 5. 27. Ibid., p. 11. 28. Ibid., p. 7. 29. Ibid., p. 27. 30. Ibid., p. 42. 31. Ibid., p. 41. 32. Ibid., p. 5. 33. Ibid., p. 4. 34. Ibid., p. 7. 35. Ibid., p. 7. 36. Ibid., p. 4. 37. Ibid., p. 5. 38. Ibid., p. 7. 39. Ibid., p. 44. 40. Ibid., p. 7. 41. Web, August 17, 2015 http://money.cnn.com/2014/03/19 /technology/innovation/pandora-fees/, Pandora, 2014 10K, p. 5. 42. Ibid., p. 47. 43. Ibid., p. 7. 44. Ibid., p. 5. 45. Ibid., p. 41. 46. Ibid., p. 42. 47. Ibid., p. 2. 48. Web, August 17, 2015 http://www.pandora.com/everywhere /home 49. Web, August 17, 2015 http://www.pandora.com/everywhere /auto 50. Web, August 18, 2015 http://www.pandora.com/everywhere /auto 51. Web, August 18, 2015 http://www.pandora.com/everywhere /home 52. Pandora 2014 10K, p. 46. Web August 21, 2015 http://investor .pandora.com/phoenix.zhtml?c=227956&p=proxy 53. Ibid., p. 46. 54. Ibid., p. 27. 55. Ibid., p. 78. 56. Ibid., p. 78. 57. Ibid., p. 78. 58. Ibid., p. 78. 59. Ibid., p. 9. 60. Ibid., p. 9. 61. Ibid., p. 9. 62. Ibid., p. 9. 63. Ibid., p. 9. 64. Ibid., p. 15. 65. Web, August 17, 2015 http://www.historyorb.com/events /date/1907 66. Web, August 19, 2015 http://fivehype.com/fivehype-offerspandora-advertising/ Z11_WHEE5488_15_GE_CA11.indd 17 11-17 67. Web, August 19, 2015 http://www.siriusxm.com /ourmostpopularpackages 68. Web, August 19, 2015 http://www.siriusxm.com /corporate 69. Web, August 19, 2015 http://www.siriusxm.com/corporate 70. Pandora, 2014 Annual Report, p. 41. Web August 24, 2015 http://investor.pandora.com/phoenix.zhtml?c= 227956&p=proxy 71. Web, August 29, 2015 http://investor.pandora.com/phoenix .zhtml?c=227956&p=irol-newsArticle&ID=1793860 72. Web, August 29, 2015 http://www.cnn.com/2011/TECH /web/07/21/spotify.fortune.brainstorm/ 73. Web, August 29, 2015 http://gigaom.com/2011/06/24 /spotify-us-launch-july/ 74. Web, August 30, 2015 http://pitchfork.com/news/52237 -apple-announces-itunes-radio-launch-date/ 75. Web, August 30, 2015 http://www.theguardian.com/media/ media-blog/2013/jun/16/itunes-radio-apple-musicstreaming 76. Web, August 29, 2015 http://www.apple.com/itunes/affiliates /resources/documentation/available-countries-regions .html 77. Pandora 2014 10K, p. 3, Pandora 201410K, p. 4, Pandora 2014 10K, p. 27. Web August 24, 2015 http://investor .pandora.com/phoenix.zhtml?c=227956&p=proxy 78. Web, September 4, 2015 http://www.siriusxm.com/our mostpopularpackages, http://www.siriusxm.com/corporate, http://www.reuters.com/article/2013/09/26/entertainment -us-siriusxm-international-idUSBRE98P0NN20130926 79. Web, September 4, 2015 http://www.pocket-lint.com /news/125771-spotify-free-vs-spotify-premium-what-sthe-difference, https://support.spotify.com/us/learn-more /faq/#!/article/Availability-in-overseas-territories 80. Web, September 4, 2015 http://adage.com/article/digital /apple-s-itunes-radio-users-pay-avoid-ads/242022/, http://appleinsider.com/articles/14/02/10/apple-begins -international-rollout-for-itunes-radio-launches-in-australia 81. Pandora 2014 10K, p. 16. Web August 2, 2015 http://investor .pandora.com/phoenix.zhtml?c=227956&p=proxy 82. Ibid., p. 44. 83. Ibid., p. 44. 84. Ibid., p. 44. 85. Web, September 4, 2015 http://www.dailyfinance.com/on /why-cant-apple-google-microsoft-beat-spotify-pandora/ 86. Pandora 2014 10K, p. 50. Web August 27, 2015 http:// investor.pandora.com/phoenix.zhtml?c=227956&p=proxy 87. Ibid., p. 17. 88. Web, September 4, 2015 http://blogs.wsj.com /digits/2011/08/24/steve-jobss-best-quotes/ 6/20/17 10:21 AM
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