Pandora to Expand Music Service with Rdio Buy

The inevitable consolidation of digital music services continued this week with Pandora agreeing to purchase Rdio for $75 million in cash. The combined assets of the two companies will be better positioned to take on Spotify, Apple Music, Google Play Music and other all-in-one music services. But it’s unclear how many of these services the market can accommodate.

“Pandora has been a pioneer in music streaming for the last decade and shares our passion for delivering the best service possible to music fans everywhere,” the Rdio team writes in a post to its blog. “We’re very excited to continue our tradition of delivering beautiful and powerful music experiences to an even larger audience.”

Pandora, as you may know, is one of the world’s most popular music streaming services, with about 75 million active users. Primarily, it provides radio station-like functionality, with users priming dynamic playlists with favorite artists and then liking and disliking individual tracks in order to fine-tune the experience. Pandora provides both free and paid versions of its service, with teh free version delivering ads and limited song skips.

Rdio, meanwhile, also comes with free and paid tiers, and it too can deliver artist-based dynamic playlists, called stations. But it works a bit more like Groove or popular services such as Spotify in that it also lets you listen to individual artists or albums, and if you pay for the service, you can listen to downloaded music offline. (Rdio offers two paid tiers for $3.99 and $9.99 per month.)

When you combine these services, you get the equivalent of Spotify, with Pandora providing the reach/users plus its own expertise, and Rdio providing the full meal deal when it comes to capabilities.

But here’s the hook if you’re a Windows and/or Windows phone user: Both of these services are well represented on your favorite platforms already, and both offer native Windows and Windows phone apps. So if you’re worried about getting shut out of services like Apple Music and Google Play Music, Rdio—or Pandora + Rdio, whatever happens there—is a viable cross-platform alternative, alongside Spotify and Groove.

For Microsoft, this is obviously good news in a platforms sense, but bad news for Groove, which Microsoft has frankly never really taken out of first gear. Rdio by itself is at least the equal of Groove, but this service still loses out on the rich curated sets of playlists provided by Apple Music and Spotify (and, to a lesser extent, Google).

In fact, Pandora + Rdio is a lot what MixRadio + Groove might have looked like had Microsoft not sold off MixRadio after it acquired it as part of the failed Nokia purchase. I wish Microsoft had kept MixRadio, though the service has of course continued, for now.

I’m curious to see how (or if) Pandora integrates Rdio into its own service, and what brand emerges as the winner.