Why Would Mel Karmazin Go to Pandora Media Inc (P)? – CBS Corporation (CBS), Sirius XM Radio Inc (SIRI)

Pandora Media Inc (NYSE:P) may have stunned investors with last week’s announcement that CEO Joe Kennedy would be stepping down after helping the company’s board find a replacement, but it didn’t take long for speculation to begin stirring about Mel Karmazin taking his place.

Billboard opined a day later that Pandora may be looking for a seasoned radio veteran to take Kennedy’s place. A former radio exec argues that Karmazin would be a good fit.

“He is the smartest media executive I have ever known,” he argues.

Pandora Media Inc (NYSE:P)Several financial outlets and bloggers have been throwing their weight behind the former CBS Corporation (NYSE:CBS) and Sirius XM Radio Inc (NASDAQ:SIRI) chief to take the reins at Pandora.

It doesn’t seem feasible.

Karmazin doesn’t come cheap, and you have to remember that Pandora Media Inc (NYSE:P) lost money in its latest fiscal year on the way to ringing up $427.1 million in revenue. Sirius XM Radio Inc (NASDAQ:SIRI) was profitable on $3.4 billion in revenue.

Pandora Media Inc (NYSE:P) won’t have a problem finding a proven terrestrial vet to hop on the growing Pandora platform, but Karmazin is probably out of its price range.

Then again, does Pandora Media Inc (NYSE:P) even need a radio veteran?

Pandora Media Inc (NYSE:P) loves to compare its usage to the country’s overall radio listenership — it’s not up 8% of total U.S. radio listening — but it’s not a radio company. It’s a streaming music service with comedy as filler.

This isn’t Sirius XM Radio Inc (NASDAQ:SIRI) with $300 million a year to invest in programming and content. This isn’t CBS Corporation (NYSE:CBS) with countless local AM and FM stations to nurture.

Sure, one can argue that at the end of the day Pandora Media Inc (NYSE:P) is simply out to sell audio ads just like conventional radio. That’s fair. Pandora’s push to match Sirius XM Radio Inc (NASDAQ:SIRI) and Spotify in premium subscription revenue isn’t terrestrial fodder, though that’s more ammo for Karmazin as the ideal CEO as the master of both.

However, Pandora is ultimately a technology company. It’s no surprise that Pandora’s biggest threats on the horizon are tech giants. Google Inc (NASDAQ:GOOG) is gearing up to launch a pair of branded digital music services through YouTube and Google Play. Reports continue to surface about Apple Inc. (NASDAQ:AAPL) negotiating with its record label partners for attractive streaming royalty rates.

Pandora doesn’t need someone to pit Pandora Media Inc (NYSE:P) against CBS Radio and other terrestrial offerings. Pandora’s already winning that bout. Sirius XM Radio Inc (NASDAQ:SIRI) has been a Wall Street winner over the past four years, but Pandora is also growing a lot faster — in revenue and users — than Sirius XM Radio Inc (NASDAQ:SIRI).

Pandora needs a tech visionary at the helm. The real battle will be about technology as companies jockey for the best apps and auto dashboard integration. Karmazin would turn heads, but he’s not necessarily the leader that Pandora needs right now.

The article Why Would Mel Karmazin Go to Pandora? originally appeared on Fool.com and is written by Rick Munarriz, Munarriz.

Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Apple and Google.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Top 10 Highest Paying Jobs in the World

Most Expensive Day-Care in New York City

The 10 Cheapest Places to Retire Abroad

Top 10 Most Expensive Luxury Cars in the World – 2014

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!