After 30 Days, iTunes Radio Has 30 Percent of Pandora’s Audience…

Guernica, Ruinen

Because if Pandora executives weren’t so worried about Apple, they wouldn’t keep telling us they weren’t so worried about Apple.  Which brings us to iTunes Radio, which now boasts 20 million users after just  one month of existence.  That builds upon an initial, post-launch surge of 11 million users, which turns out to be more than just a curiosity thing.

It also means that Apple now has nearly one-third the entire active listener base of Pandora.  At its latest shareholder meeting, Pandora pointed to 72.7 million active users.

That ratio likely to tip 50 percent – easily – by the end of the year, and may even surpass Pandora’s base in early 2014.  Already, Apple is boasting one billion cumulative streams on iTunes Radio, and that is only within the United States.  Just recently, Apple tipped plans to aggressively expand into Australia, New Zealand, Sweden, Norway, Denmark, and surrounding countries early next year.

Currently, Pandora is restricted to the US, Australia, and New Zealand.

But these ripples go far beyond Pandora.  Already, signs of devastation are surfacing for smaller radio competitors, including Slacker.  Just this morning, word of significant layoffs at Slacker emerged, possibly a result of Apple’s entry.  Slacker has yet to comment.

Image: ‘Die Ruinen von Guernica,’ 1937, photographer unknown. 

19 Responses

  1. A one time user is not "ACTIVE"

    Digital Music News is often void of logic in a rush to sensationalize stories. It’s so unnecessary.

    As for this flimsy illogical articles this is a good example. Apple has a few hundred millions users and they force an update on them and get a maybe 10% to try iTunes radio. That’s not an “ACTIVE USER” but rather a one time user. They may be back for more and become an active user or maybe not but under no definition is it an active user.

    The more salient point is Apple’s announced international expansion. In the US Pandora has an enormous and sturdy lead but it appears their first mover advantage will not happen in Europe. Pandora is a no-show internationally and appears to fall hopelessly behind Apple while they wait for royalty laws to change (which seems unlikely to ever happen). Pandora is land locked and they’ve saturated the US market so future growth will be slim.

    • Pandora's Ghost

      WRONG: Active is measured over the past MONTH, so Apple has been in the game for one month. Got it?

      • Pandora's Brainless Ghost

        Active users are ones that come back and regularly use the service not those that say “oh what’s this shiny new icon on my phone” and click it. Obviously Apple can force people to try a new service. Remember Ping? Remember how they trumpeted how many users that had? Those weren’t ongoing engaged users.

        iTunes active users will be a fraction of the 20 million that tried it. Maybe 25%. That’s 5MM active users or about 1/10th Pandora.

    • jw

      I think this is a good point. This early, it’s very tough to tell what the picture really looks like. For all we know, many Pandora users might’ve tried the service & decided that they like Pandora better. It’s just too early to know. I would wait to see what the numbers look like in January before really making a judgment.

      Furthermore, the total user base is likely to drop from this opening number in the nearterm, as users who initially tried the service don’t stick with it. And I can’t see real growth being as dramatic over the next few months as in the first month (with all of the launch fanfare). So the likelihood that they’ll be sitting on a user base half the size of Pandora’s come January seems unlikely to me, though stranger things have happened. What’s clear, though, is that DMN is jumping the gun &, again, providing an unjustifiably bleak forecast for Pandora. Are you shorting the stock, Paul? 😉

      Additionally, if Apple is growing the streaming radio market, rather than just siphoning users from Pandora, this is great news for everyone.

  2. Yves Villeneuve

    There are about 140 million (70mm are currently active today) iTunes music accounts worldwide. 30% or 42mm (21mm are currently active) are based in the USA. A NPD survey suggests 48% of active accounts use Internet radio therefore, unless active accounts increase or iTunes has successfully expanded the Internet radio listener base, there are only 10mm active iTunes Radio listeners.

    Keep in mind, active American Pandora listeners total 22mm. The rest are based in locations all over the world bypassing blocks. This means American advertisers are reluctantly promoting to non-Americans causing strong downward pressure on Pandora ad rates. If Pandora creates sites in every country location worldwide its ad rates will significantly increase since ads will be more effectively targeted creating enormous profits for its shareholders.

  3. Yves Villeneuve

    1 Billion is not a lot of streams even for 10 million listeners. If it’s closer to 2 Billion streams and 10 million listeners, it’s still only 66% of Pandora’s listening hours per user, in my estimation. So far there hasn’t been full adoption of iTunes Radio by the average Internet radio listener based on listening hours. Maybe American Internet radio users listen a lot less than foreign users?

  4. _bjb

    As a US user in Asia iTunes radio accessibility has been great. I actually listen to music again. They are not doing the idiotic IP blocks like Pandora does. Just do a twitter search for “Pandora itunes radio” you can see for yourself Pandora is getting killed.

  5. gg be

    1 billion streams / 20 million users = 50 songs per users

    The average Pandora users stream about 350 songs per month.

    7 times more

  6. Jacob Chang

    So far the best article i have come across, here is another one http://goo.gl/3w31N3 with the facts and statistics about the itunes Radio’s performance and Pandora’s Performances. I must say, there is gonna be a serious competition between these two giants, God Bless Pandora!

  7. Anonymous

    iTunes isn’t going to snuff out Pandora for the simple fact that it lacks Android support. If Apple decides to support Android (lololololololol hahahahahahahaha) maybe Pandora is screwed.

    • Vail, CO

      Funny, we used to have the same argument about iTunes back in the day. When it was mac only.

      • jw

        You can use an iPhone with a windows computer, so releasing iTunes for Windows helped to sell iPods/iPhones.

        From Apple’s perspective, their software side exists to maximize hardware sales. If a software product doesn’t ultimately help to sell their own hardware, it’s essentially helping to sell someone else’s hardware. So Apple will pretty much never introduce a product for a competing mobile platform. I don’t think that Apple will ever release an iTunes Radio app for Android, there’s not enough money in it as a standalone product, & it doesn’t fit into their overall company strategy.

  8. Oz

    current & future metrics aside, Apple has a more-or-less complete ecosystem, while Pandora has nothing of the sort. Aside from Android support being a fairly major sticking point, there are very few logical reasons why iTunes radio won’t become almost the default player – not because it’s a standalone product, but BECAUSE it’s part of this larger ecosystem.

    • Anonymous

      Pandora must move beyond the US. They’ve got a great brand so they need to offer their service to Europe. Apple has said they’re going to Europe. Europe is where the growth is.

  9. Anonymous

    So Pandora saying they’re not worried about competition from Apple means they’re worried? So every company is always worried about everything?

    Dear DMN – please look up the word TAUTOLOGY.

    • Paul Resnikoff

      “So Pandora saying they’re not worried about competition from Apple means they’re worried?”

      Yes.

      “So every company is always worried about everything?”

      No.

      Dear DMN – please look up the word TAUTOLOGY.

      It doesn’t apply, but I’m happy you know a big word.