Internet radio is going pop, and I'm not talking about the current state of music given chart toppers Justin Bieber, Katy Perry, and whatever Patrice Wilson will pass off as infectious ear candy.

Spotify has completed a $100 million round of financing that values the global music streaming speedster at a whopping $3 billion. Yes, that's more than twice what Pandora's (NYSE:P) worth these days. However, the real surprise is in one of the investors.

Investment banker Goldman Sachs and mutual fund behemoth Fidelity Investments make perfect sense, but kicking in a $10 million investment, surprisingly enough, is Coca-Cola (NYSE:KO).

The original pop star is now an investor in Internet radio?

It may seem to be a lousy time to be buying into digital music. Record labels that counted on downloads to offset declining CD sales are struggling. Pandora -- the pioneer of music discovery -- has seen its stock lose more than half of its value since its springtime peak.

However, this is also clearly an important battleground. All of the major consumer-facing tech companies are either diving into streaming music or rumored to be in negotiations.

Last month it was Microsoft (NASDAQ:MSFT) introducing Xbox Music, an enhanced streaming service that offers the music discovery of Pandora and the playlist building of Spotify. It also offers MP3 download purchases, pitting it -- once more-- against Apple (NASDAQ:AAPL).

Apple led the digital music revolution, and its iTunes Music Store is still the country's largest reseller of music. However, Apple has been absent from the Pandora and Spotify models that everyone seems to be ripping off these days. That will probably change, and sooner rather than later, going by reports claiming that Apple is in licensing talks with its label partners.

Even conventional radio broadcasters have gone digital. Clear Channel has the popular iHeartRadio app and Sirius XM Radio (NASDAQ:SIRI) is moving beyond satellite radio. It has been offering online simulcast of most of its stations for years, but it introduced on-demand streaming for select shows this summer. It plans to introduce a Pandora-like personalized radio online offering by the end of the year.

Coca-Cola is still betting on a smart horse. Pandora is the top dog in this country, but as a global brand, it makes sense for Coca-Cola to go with the globally popular Spotify. Besides, it's not as if Coca-Cola has to eventually bet on just one service, especially if its presence as an early investor will keep rivals away as buyers (if not advertisers).

The battle of the bands has become a battle of the brands.

Enjoy the show.

Streaming out loud
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