When it comes to internet radio, Pandora leads the way

Site creates ‘stations’ based on user interests

For some college students, listening to music can be a conundrum.

Buying music is out of the question, since paying a dollar per song is too pricey. Some are uncomfortable with illegally downloading music. But many still want to legally listen to a wide variety of music free of charge.

Thank goodness for the Internet.

In the last decade, numerous Internet radio companies have emerged to take control of a sizable portion of the radio industry. The largest of these companies is Pandora Radio, which reported a profit of $50 million in 2009. This is significant for a company that has come close to bankruptcy numerous times because of royalty fees paid to record companies.

Internet radio doesn’t work like a traditional radio station. Pandora users create their own radio station by making a list of music genres, bands or even songs they want Pandora to play. Pandora then takes the user’s selections and creates a radio station that could include anything from hip-hop to songs from the musical Grease.

Erik Ugland, a professor in the College of Communication, is an avid Pandora fan. He said the site uses hundreds of attributes from user’s music selections to concoct a radio station from its 700,000 song library. Pandora named this system the “Music Genome Project.”

“It has a massive library and it really nails down people’s music tastes,” Ugland said.

For those who have followed the Internet radio industry from the beginning, Pandora’s increased revenue is an exciting development they hope will ensure Internet radio is here to stay.

Eric Benderoff is a former Chicago Tribune tech columnist who now runs Bendable Media, a media consulting company. Benderoff said he’s a huge fan of Internet radio and has used Pandora and sites like it for years.

Benderoff said Pandora, which according to the New York Times attracts about 48 million users each month, has started to make money from increased commercials and sponsorships. One of the reasons Benderoff enjoys Pandora so much is the fact that it only has about five minutes of commercials per hour. When compared to traditional FM radio stations, that’s not much at all.

“Pandora can be anything you want it to be,” Benderoff said. “It’s really great for those people who want a wide variety of music.”

Pandora’s climb to the top was not an overnight success story. Internet radio provides numerous technological problems, such as the lack of mobile listening ability, Ugland said.

According to Ugland, Pandora was able to hurdle the mobile problem through a hugely popular iPhone application, allowing users to listen to Pandora on their phones. Ugland said Pandora has also been able to make money through unique revenue streams, such as an iTunes link to the song users are listening to.

Pandora is particularly popular among college students. Ben Knuesel, a sophomore in the College of Arts & Sciences, said he uses Pandora about twice a week.

“It plays a good mix of songs I have never heard of and music I have listened to my whole life,” Knuesel said.

Still, some question the necessity of Internet radio. Ugland said Pandora may not be the most necessary technology for those with huge music libraries on their computers, or for those who only like one genre of music.

Brett Bielanski, a sophomore in the College of Business Administration, said he doesn’t need Internet radio, since he has more than 14,000 songs on his computer.

“My computer shuffles songs just like Pandora, except I don’t have to listen to ads, and I am reasonably certain I will like most songs that are played,” Bielanski said.