Digital Notes: Yahoo's Music Play; Beep's Wireless Dial; and Pandora's Subscription Growth

Beep founders Shawn Lewis, left, and Daniel Conrad. Credit: Beep.

-- The wireless home audio market is about to heat up. Beep, a San Francisco start-up backed by David Dolby of Dolby Laboratories, Reddit Co-Founder Alexis Ohanian, Y Combinator partner Garry Tan and a dozen other technology heavyweights, has unveiled a device that will let any speaker with an auxiliary input stream music over Wi-Fi. Beep said it expects to ship its stylized copper dial attachment in the fall. The device will retail for $149, but pre-orders are going for $99. The company said it will launch with the ability to stream Pandora and is working to sign up other streaming services.

Beep is one of many companies crowding into a space that has been traditionally occupied by Sonos, the Santa Barbara, Calif., audio company that pioneered the concept of multi-room wireless audio for the masses. At the Consumer Electronics Show in January, for instance, Rocki showed prototypes of its $49 Wi-Fi dongle, which is also expected to ship later this year. Qualcomm Inc. also announced partnerships with Panasonic, Altec Lansing and others to introduce wireless audio streaming speakers compatible with services such as iHeartRadio, Rhapsody, TuneIn, SomaFm and others.

Beep's target market initially includes legacy speakers, 42.5 million of which were sold in 2012, according to ABI Research. But the company plans to license its technology for a new generation of connected speakers, said co-founder, Daniel Conrad, who was Google's Android business product manager for four years prior to creating Beep last year with Shawn Lewis.

The market for wireless audio, which includes A/V receivers such as the Sonos systems, soundbars and bluetooth speakers such as Beats' Pill and Jawbone's Jambox, doubled in size last year to $1.8 billion in the U.S., said Ben Arnold, Executive Director of Consumer Technology at the NPD Group. 

-- Yahoo added music discovery to its Aviate mobile homescreen app. A month after Yahoo CEO Marissa Mayer announced during her CES keynote the acquisition of Aviate, a homescreen application, the company said it has added a music discovery feature to the app.

Aviate bills itself as an "intelligent homescreen" for smartphones. The app taps into your schedule and activities to proactively deliver driving directions to the user's next destination, weather, stock prices, restaurant reviews and other tidbits of information based on where the user is and what the app thinks is happening. Now, Aviate will automatically navigate users to their music apps when headphones are plugged in. When a song is playing, it will display artist information, local concert dates, YouTube videos and other related content.

The app is still in beta and not available for general download, but is allowing new users to download the app using the code MUSIC. For now, Aviate is only available for Android devices, and there's no word from Yahoo on whether it will be made available on iOS.

-- Pandora shows strong subscription growth. Will people pay for a free service? Pandora, largely known for its free Internet radio offering, posted surprising growth in its $3.99-a-month PandoraOne service in its latest year-end earnings release. Though the vast majority of Pandora's 76.2 million monthly listeners access the ad-supported streaming radio version, 3.3 million a have signed up as of Dec. 31 for the premium experience, which has no ads.

That number appears to have grown. The percentage of revenue Pandora gets from subscriptions jumped to 18.3% at the end of 2013, up from 12% a year earlier. (The rest come from advertising on Pandora's free radio service.) Put another way, Pandora more than doubled its annual revenue from subscriptions to $116.7 million in 2013, up from $49.3 million in 2012. This is born out by the app's consistent showing throughout the year on the iTunes' top grossing music apps (it was No. 1 on the chart as on Wednesday).

Questions? Comments? Let us know: @billboardbiz

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