Monday, July 21, 2008

Pandora's Success With iPhone Bodes Well for Internet Radio

The Sirius-XM merger should have been approved a year ago. The FCC's concern of monopoly is a non issue with technological change, primarily the rise of internet radio. The success of iPhone and applications from Pandora indicate that internet radio represents a clear alternative to subscription radio.

"Internet radio upstart Pandora has streamed 3.3 million songs to iPhone users since the launch of its new mobile application, making it the third most popular such application for the red hot device" The success of the next generation of iPhone is bringing more users to the app. As autos are wired for connectivity to their wireless phones, it will act similarly as a conduit to internet radio. So where does that leave Sirius; it's success remains dependent on exclusive content like Howard Stern, out of market sports, and others. The fight for great content will either make Sirius a winner or a trivia game answer in 5 years.

As for Pandora and the iPhone, internet radio seems to be a highly regarded feature that brings more value to the mobile device. And anything that brings the consumer is bound to bring new advertising opportunities as well. "This level of intense engagement is likely to excite the ad community, which has been patiently waiting for more mass buying options in mobile media."