Tim Westergren
The co-founder of Pandora Internet radio on the future of the music industry.
By Kay Steiger
January 26, 2009
Tim Westergren, co-founder of Pandora.Tim Westergren grew up in Minneapolis, MN and attended Stanford University, where he studied computer acoustics and recording technology. He started out as a piano player—he later learned how to play drums, bassoon, and clarinet—then dabbled in recording production. He started Pandora in 2000. The site was based on the Music Genome Project, an initiative in which thousands of songs were analyzed by professional musicians to help users discover new songs and bands they might like. In 2005, the project launched as an online radio streaming service. Today, Pandora has about 20 million registered users and adds more than a million a month.
How did Pandora get started?
I founded the company about nine years ago. I was led to it through my own experiences as a musician. I was a performing musician for a long time. I originally built the product thinking it was going to be a recommendation tool to help people find bands. And when I launched the company in 2000 we actually built a recommendation technology that we licensed to other companies for about 4 years. It wasn’t until mid-2004 that we decided to repurpose that technology and become a consumer-based Internet radio company. We spent about four and a half years building up what wound up being the intellectual property core for Pandora not knowing in the beginning that we would become a radio station.
What we really spent most of our time on during those years was building up the Music Genome Project, which is the enormous musical taxonomy of hundreds of thousands of songs that have each been manually analyzed by a trained musician along close to 400 attributes per song. It’s really kind of this big study of musical DNA and it provides the connective tissue that powers Pandora. In 2004 we had built this great big, gigantic database and just repurposed it into a playlist engine, which we launched in November 2005. It just took off like rocket ship.
Can you explain the Internet Radio Equality Act for our readers? Are there any battles like that coming up soon?
I hope not. Pandora operates under what’s called a statutory license. A federal law called the Digital Millennium Copyright Act governs our industry. It establishes the structures for the business, the constraints. It also establishes a fee-setting structure. So following the DMCA, we pay what’s called a performance fee, which is a per-song fee that goes to the performers of the songs. It’s actually split half to musicians and half to the record label. That performance fee is arbitrated every five years by a panel of judges from the copyright office.
In March 2007 that panel issued its ruling for the years from 2006 to 2011, and the number they coughed up was just ludicrous, essentially. It looked like we were going to be toast. But we organized our listeners into this big public opposition and were able to put so much pressure on Congress that they intervened and forced the [Recording Industry Artists of America] to renegotiate the rate. We’re just about to settle, so after just about a year negotiating it looks like we’re not far from getting it resolved.
Do you feel that Pandora’s business model is progressive?
In some ways we’re very, very old-fashioned media company that’s building an audience and selling advertising. But I think that there are ways in which we run our company that are dramatically different. One of them is in how we interact with our customers. Pandora answers every email we receive personally and we get, you know, 10,000 a month. We spend a lot of time actually in front of customers. I spend probably half my time in townhall meetings with listeners and really opening up the conversation with people. They drive a lot of our product priorities and we really cultivate those relationships.
I think also money is not the driving force behind Pandora. As a company, we are organized around a different mission, which is redefining radio, getting people the music they love, helping them to discover music, and also building a musician’s middle class. We see money as a means to doing that as opposed to vice versa.
What’s your perspective on what young people tend to think of as the “evil record industry”? It used to be that bands really needed the record industry, but now bands can make their own recordings in their basements with a MacBook and some mics. Will major labels as they have existed go away anytime soon?
I do think record labels are going to change dramatically. I don’t think you’re going to recognize them five years from now. I think they will no longer be in the business of recruiting and developing new artists. They’re going to be in the business of exploiting their existing catalog. Artist development will be taken up by a cottage industry of entrepreneurs and do-it-yourself artists and managers that will take advantage of all these tools that are available now for free over the Web.
The industry has been built on a three-legged stool: production, distribution, and promotion. With free software you can create a record that sounds like it was produced in a multi-million-dollar recording studio. So the production piece is no longer the sole domain of labels. And distribution is free now. You just put it on CD Baby and you’re done. And then, if the promotion problem gets solved, you really don’t have a need for a record label anymore.
Is the RIAA’s strategy of tracking down and punishing those who download music for free sustainable?
I don’t think it’s sustainable. I’m not sure it’s irrational in the short term. Music’s being stolen and it’s not legal and it is costing them money, but I think you can’t sue your way out of that problem. What’s going to happen inevitably here is a pretty fundamental adjustment at record labels. I think they’re going to fight to the bitter end.
Record labels don’t operate any differently than almost any other industry. Carmakers, if you were stealing their cars, they’d come after you. When they sell cars they want to sell them for as much as they can sell them for. That’s not the sole domain of record labels. File sharing has introduced this really unusual dynamic into the industry where if you don’t treat a customer right they just won’t pay for your music and they won’t have to. I think that’s hard for someone to learn who grew up in the CD business—the [19]60s, ‘70s, and ‘80s. These are the people who are running record labels, by and large.
I’m not actually one who subscribes to the “record labels are evil” [mindset]. I think they’re a natural result of the world of broadcast. If you’re an artist and you want to get on pop radio, there’s only one way you’re going to do it and that’s to get a record label deal. At least that’s historically been true. That means there’s an enormous amount of competition and there’s not that many spots open on broadcast radio.
What are you listening to now?
Ben Folds has been a favorite of mine for a few years now and he has introduced me to lots of other bands. The Gabe Dixon Band is a favorite of mine. Jamie Cullum is a guy I found through them. They’ve all come to me through my Ben Folds stations. I listen to a pretty broad range of stuff. Some days it’s jazz, classical, [and] punk. I’m a piano player at heart, though, so I generally go back to the piano/bass stuff.
Do you have advice for young people who might want to do something similar?
One thing that I learned is make sure you find a partner; don’t do it alone. I don’t mean employees. I mean someone who is an owner with you. It’s just—it’s really grueling and I can’t imagine having done this alone. And I think the other thing is try to find something that you just love doing. You’re going to work harder than you ever thought you could work. If you don’t really, really enjoy it, then it’s twice as hard. I worked on this company for four or five years, seven days a week, fifteen hours a day. If I didn’t really enjoy it and feel strongly about what I was trying to build I don’t think I would’ve lasted mentally.
Kay Steiger is an associate editor at Campus Progress.
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Comments
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The traditional music industry is not evil. The problem is music as art vs music as a business. The business side destroys musical freedom. Two examples of bands who were artistically destroyed by the business side. Red Hot Chili Peppers and Bush.
Bush had an incredible debut album. The worst song on the album was Glycerine. Bush gained acceptance as a HEAVY band. Glycerine was sing along pop which expanded the audience and when it came time for album two the record company said you had better repeat your success due to our investment in you. So album two sucked and the initial audience into HEAVY rock said F You and refused to buy it. Now Bush is deceased.
The RHCP’s on the other hand stayed successful as a business while failing as an artist. Under The bridge was the most successful song off Blood Sugar Sex Magic. Yet it was the worst song on the album. Breaking the Girl was 10x better as a ballad from an artistic stand point. But Under the Bridge widened their audience to the Pop music world which most true music snobs loathe. Like U2 and REM they shed their indie/alt fans and went after the Debbie Gibson, Dave Matthews, brittney Spears fans and have become wildly successful economically.
But if you ask a music snob/elitist like myself I will say the last great U2 song was Bullet the Blue Sky (only good song off Joshua Tree) and the last great album Unforgetable Fire. Last great REM album was Document. And last great RHCP album was Blood Sugar Sex Magic. I own no music for either band after those albums…yet own all their music prior to those albums.
So its business and economics and greed that is evil. Not the recording industry. Do you starve now to be a star after death or sell out for money now but be irrelevant before you die (aka britney, insync, etc).
— Howie Goldfarb - Jan 26, 01:21 PM - #Anyone interested in the issue of RIAA/copyright versus music piracy, should read this proposal by Dean Baker.
www.paecon.net/PAERe…
Copyright law is, by nature, anti-Capitalist and monopolistic, and Dean proposes a neat solution that would update the law with positive effects not only on the music industry, but also industries such as software and prescription drugs, where the inefficiencies of monopoly lead to high prices.
Like all Dean’s proposals, this would leave the existing way we do things intact, and let consumers choose in the free market which one they prefer.
Basically, copyright costs a lot for the government to enforce; so the government could save money by taking a portion of those costs, subsidizing artists (or programmers) instead, on condition that they cannot enforce copyright on the work they create while subsidized.
This would quickly create a large library of art (or software) in the public domain, while providing a decent living to artists. (If you’re against the very idea of government subsidies, you should be able to withhold your contribution by ticking a box on your tax form, like some charitable contributions are handled today. If you’re an artist who wants his work to stay copyrighted, then don’t accept the subsidy and feel free to copyright your work.)
This would result in a large body of art, music, (and software) available for free to enjoy, copy, and modify (e.g. music sampling) in the public domain. But consumers would still have their free choice to pay exorbitant amounts of money for overhyped pop singers copyrighted by the RIAA, or for buggy inefficient software copyrighted by Microsoft. If consumers want to.
It would be opening up new choices, not suppressing them.
— Exhibit B - Jan 28, 06:11 PM - #Being 65 years old, I am wondering when music is going to break free of the record label/corporate death clinch. All these years since the 60’s the shutdown of viable and great music has turned availability into a greedy, money grubbing, dishonest play of all the steps of us out in the world getting to hear great music. When I turn on FM music, I would love to hear good music, not the pap they play. It stinks. As usual, a simple and beautiful thing like music has been defiled by greed and censorship.
— musiclover - Jan 30, 01:06 PM - #