I think he's addressing the riskiness of your first DS hires. PhDs have a much higher likelihood of possessing these skills than non-PhDs. In his defense:
(1) "[T]o be competitive" means a lot in Pandora's case. They pioneered music recommendations, so they needed autonomous scientists with strong research capabilities. The vast majority of companies do not fit this profile.
(2) Earlier on he states
"Instead of setting your sights only on PhDs and research scientists, you need jacks-of-all-trades who tend to be more interested in practical applications than theory."
He's guilty of mixing absolutes: you NEED these types but hiring PhDs is "crucial." Why not hire PhDs with 10+ years of coding and product experience at slightly below market + equity while you're at it?
Your point about experience beyond academia is crucial. Recent PhDs with little or no commercial experience are a really risky bet as a first hire since they'll need to shed the academic cruft they carry before becoming productive.
