Pandora has recently acquired rights to stream music from Sony Music and Universal Music helping it launch a new subscription service and keep competitors like Spotify and Apple Music at bay.
Sony Music and Universal Music have agreed to lend a hand to Pandora, which hopes to protect its market share in the music streaming business with the new deal, according to a report by Bloomberg.
The report said that Pandora acquired "licenses to music from three of the world's largest rights holders" which the company hopes will prepare the way for two new streaming subscription services.
Sony Music, Universal Music and Merlin Network, which has rights to more than 20,000 independent music artists, have agreed to the licenses, Pandora announced Tuesday.
Pandora has also sought a deal with Warner Music, but has yet to come to any agreement.
The new music license deals will give Pandora an opportunity to introduce two new services it has been developing for some time: first, an advertising-free radio service called Pandora Plus; and second, an on-demand music streaming service similar to what rival Spotify offers. Pandora plans to offer both services to users before the year ends.
According to Bloomberg, by allowing users to choose songs on-demand, replay them and customize playlists, Pandora hopes to bring in new listeners and prevent existing users from leaving and shifting to competing services like YouTube and Spotify.
According to Cnet, "the service would bring Pandora into the modern realities of the music business. The rapid-fire growth in subscription, all-you-can-eat services in the last two years has made that the presumed default model for music sales going forward."
"This was a truly collaborative attempt to find a solution that would support artists while profitably growing our respective businesses," Tim Westergren, Pandora's founder and CEO, said in a statement.
It can be recalled that Pandora announced in July that it had 78.1 million active listeners as of June 30. Although that is enough to make Pandora the world's largest online radio service, the company's number of users shrank last year while their rivals Spotify and Apple Music attracted millions of new customers.