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Surprise, surprise, Pandora is one of a long list of web companies that monitors your online activity and sells your identity profile to brands so they can sell targeted ads to you. On top of the basic information it has on you, like your age and zip code, the company infers things about your personality based on the songs you "thumbs up” or "thumbs down," the New York Times reported. In other words, it's basically stereotyping you based on your taste in music.
Now, Pandora will have one more factor to categorize users by: whether or not you're listening in the car. At the Consumer Electronics Show in Las Vegas today the company announced it will partner with 140 different car models on an in-car radio service that will include targeted advertising. Pandora with either integrate directly with future connected cars through the dashboard, or indirectly through in-car devices enabled with the radio service.
It's the first major deal that merges Internet radio and smart cars, but it's not a surprising move. Automobiles are coming off the assembly line increasingly resembling smartphones, which is where the lion's share of users are listening to Pandora and its competitors. At the same time, the car is still where people are most likely to tune in to the radio. It was only a matter of time before someone launched a better system that fumbling with your cell phone as it's plugged into the vehicle's audio jack and balancing awkwardly in the center console.
The in-car radio service is expected to be a lucrative move for Pandora. For paying subscribers, nothing will change other than the (hopefully) more convenient user interface. But freemium subscribers listening en route will hear fewer ads—albeit ones targeted specifically to drivers.
The upside for users is obviously not having to sit through as many ads, which will probably encourage people to adopt the new service. The upside for advertisers, and in turn Pandora, is they're getting more details about users—namely, that they have a car and drive it. Hence, the first brands to advertise with the new service are State Farm, BP, Ford, and Taco Bell.
Notably, tech giants like Google and Apple also have skin in both the online music and smart car games (the companies have 310 and 35 pending auto-related patents, respectively). What kind of deals will they strike with automakers? We could make a slow creep back to the old days of flipping through the car radio, looking for a station playing music instead of commercials, as targeted advertisements find their way from the information superhighway to the regular highway. Pandora may have just opened a Pandora's box.