That is what has happened with Pandora, an Internet radio service launched last year that was immediately recognized by the hipper-than-thou Net music crowd as one of the best ideas of 2005. Almost as soon as the first notes trickled out of Pandora, music fans were proclaiming its genius on music message boards. “Try it and you’ll be hooked!” was the word on Pandora. And you know something? They were right.

What’s so special about Pandora? Simply put, it’s one of those sites where you enter a favorite artist or song and the service then matches you up with similar tunes and artists. Sure, other services, such as Rhapsody and Napster, have similar features with their custom radio channels, but Pandora does it a little differently than most.

Pandora is the offspring of the Music Genome Project, an undertaking designed to analyze music and determine what makes people favor a particular song or artist, and then match people with music they might also like, as Pandora founder and chief strategy officer Tim Westergren told Pollstar.

“The Genome Project started in January of 2000, and that was definitely kind of a harebrained idea that was drawn from my experience as a musician,” he said. “I played in bands for a long time and I did the independent artist thing, trying to find my audience along with everybody else trying to do the same thing. The idea behind the Genome was that it would be a way to make it easy for someone to discover those bands based on better-known groups.”

A name like the Music Genome Project might conjure mental images of men and women clad in white lab coats operating equipment similar to the crime busters on “CSI.” However, the project’s origins were not quite as formal.

“I had a team of five local musicians I knew when we were building the Genome,” said Westergren. “We created multiple versions of it. Each time we made one we analyzed a thousand songs and then ran it in an Excel spreadsheet and tested it. Then do it again. It was a very iterative process.”

Even though Pandora is based upon the results of the Music Genome Project, it doesn’t strictly rely on those results to determine its own programming. Pandora users rate the songs and artists that the service suggests as compatible to users’ choices. More grist for the Project, so to speak, all in an effort to build a better Internet radio station.

But just as Pandora’s music selections are ultimately based upon human input, the marketing of the service is equally grassroots-oriented and is centered on Pandora’s user base.

“Our main strategy is to correspond with listeners. That’s just about all we’ve done,” said Westergren. “I’ve done a little traveling around the country, [conducting] Pandora meet-ups. But the marketing of Pandora has been done by users. They may tell each other, they write about it on blogs and in chat rooms. That’s how it spread. We haven’t bought, like advertising.”

But while Westergren and his Pandora buddies haven’t been big on advertising, they have partnered with other Web sites, such as Friendster and Music.com. However, those collaborations have been co-branding efforts, providing the same Pandora service, but somewhat customized to resemble the look and feel of the individual Web sites. Otherwise, Pandora has been almost humble in promoting itself on the Web, relying on word of mouth as well as customer satisfaction to spread the word.

Pandora also encourages music purchases by linking to iTunes for individual song buys and Amazon for CD sales.

For the user, Pandora comes in two flavors. The free service is advertising-supported, but if you don’t want your listening interrupted by commercials, an ad-free subscription costs $36 yearly and $12 quarterly. As you can guess, more users opt for the free service.

But Pandora is more than a streamer of established artists and their music. The service offers independent musicians a chance to also be heard.

“If you’re in an independent band, there are not that many places you can go to promote your music,” Westergren said. The main method that is available to you is to play shows … There are lots of places where you can actually warehouse your music, so you can make it available online. But the Genome, because it pays no regard to popularity, it’s just a great leveler. So, if I was an independent musician, I’d make sure our music was in Pandora, for sure.”

Westergren also said that even the smallest indie musician is welcome at Pandora, and an unknown’s music will go through the same analytical process as songs by major artists.

“They’re our favorite,” Westergren said. “We get stuff sent to us that someone burned on their computer and slapped a Post It on it.”

So there you have it – a popular music service, marketed almost solely via user satisfaction. A music portal that cares as much for the struggling musician booking his own shows and selling CDs out of the trunk of a car as it does for major artists. But what’s next for Pandora? That is, aside from building its user base?

“I hope that we can make some inroads into mobile and international,” Westergren said. “But what I really hope for more than anything is that it starts to become something that musicians look to as a legitimate avenue to build an audience. I would really like to see musicians start to think of the Genome as a very valuable tool for them.”