It’s a big week for Internet radio. The space has been buzzing about Pandora going public since the news was announced back in May. This week their stock will be sold on the New York Stock Exchange for the first time.
I have a lot of admiration for the folks at Pandora and their product. I think they have thought hard and fought hard to create a product that works for listeners and musicians. Through perseverance and innovation they’ve created a product that has arguably become the generic term for Internet radio.
Latest reports peg their registered listener list at more than 90 million. 24% of the 12+ population in the US use it. That’s more than use satellite radio, Linkedin or Twitter. Their audience is growing exponentially. Right now 60% of their listeners are mobile, and Internet radio isn’t even in cars yet. But it’s coming.
Expenses are high for Internet radio, that’s definitely the challenge for Pandora. The naysayers are out in force this week proclaiming streaming dead, or at least deadly for investors. So here’s the deal: in the last one year period, Pandora grew its user base by close to 100%. During the same period they grew revenue by about 250%. Expenses surged 195%.
I believe that Pandora will continue to grow its audience. I think they will also continue to develop new and innovative ways to sell advertising and offer value to ad partners. I also believe there are ways other than advertising to make money with a user base as large as Pandora’s. I think a registered user base of passionate listeners is rare and golden, and I’m betting that Pandora will be able to wisely leverage it to more and more profitability.
So I’m in. I’ve placed my order. Stay tuned..