itunes radio

Pandora grew audience share in October, dropped listeners

Tuesday, November 5, 2013 - 11:50am

Pandora released its internal audience metrics for October, in a Morgan Stanley conference late today in San Francisco. Pandora CFO Michael Herring presented the October results. The October report carries special significance inasmuch as it represents the first full month of iTunes Radio operating in competition with Pandora.

Pandora’s monthly metrics report contains three key indicators:

  • Share of total U.S. radio listening
  • Number of hours of music consumed
  • Number of active users

In October, Pandora’s reported listening share in the U.S. rose to 8.06 percent from a September share of 7.77 percent.

There was also month-over-month growth in consumed hours, from 1.36-billion hours in September top 1.47-billion in October.

The much-discussed “active users” measure dropped in October from the previous month, settling at 70.9-million users, a 2.5% drop from September’s 72.7-million figure. The share of U.S. radio listening measurement is controversial in the radio industry, and has been disputed by industry executives. When RAIN asked Pandora about the methodology of the share-of-listening metric, we received this reply:

"Pandora arrives at this calculation using data from Triton Digital, Arbitron and the U.S. Census. The estimated total hours include satellite radio. There is no one group that measures total radio metrics. We welcome all third-party research from a variety of established partners, including Triton Digital, Edison Research, The Media Audit, comScore and Nielsen. Ultimately, we would like to see all radio measured side-by-side."

RAIN Weekend Perspective: Week of Oct. 28 - Nov. 1

Friday, November 1, 2013 - 4:30pm

RAIN’s Weekend Perspective summarizes the week’s important events for a weekend catch-up, and revives your blasted synapses for coming week.

PARTNERSHIPS 

The Echo Nest partners with Getty Images: Music services that use The Echo Nest’s intelligence technology will be able to enhance their album art with artist and band photos. [READ]

Spotify partners with Tango Messenger: The alliance lets Tango instant message users to include 30-second Spotify music clips. You might not be familiar with Tango, but it’s a bigger service than Spotify. [READ

MUSIC SERVICES & APPS 

TuneIn reaches 100,000 radio stations: The TuneIn aggregation platform has aggregated up a storm: “The most radio stations ever in one place,” according to the press release. [READ]

Rhapsody introduces new features: RAIN reviews important additions to the Rhapsody music experience. [READ

SoundCloud reaches 250-million listeners: Take that, Pandora, as SoundCloud’s new emphasis on uninterrupted listening is bringing in new users. SoundCloud is now chasing YouTube’s 1-billion users. [READ

Pandora releases Android tablet app: RAIN reviews the essential features that exist in the new version across all devices. [READ

iHeartRadio updates features: The Clear Channel-owned platform gets into concierge-style programming, similar to Songza and Slacker, but with tongue in cheek. [READ

ILLUMINATION 

Edison Research videos show a “barrage of new” in connected cars: Seeking insight to how new-car owners are coping with modern infotainment systems built into digital dashboards, Edison Research produced video interviews with recent car buyers. RAIN interviewed president Larry Rosin. [READ]

Survey/Interview - iTunes Radio little threat to Pandora: Investment firm Canaccord Genuity surveyed Pandora users who have tried iTunes Radio, to get a picture of its existential threat to Pandora. RAIN interviewed the study’s author. [READ]

BIZ / LEGAL 

Swedish musicians threaten to sue labels over Spotify distribution: The musicians' argument is less with Spotify than with labels, and how Spotify revenue is shared with artists by those labels. RAIN untangles it. [READ]

Survey and Interview: iTunes Radio little threat to Pandora

Tuesday, October 29, 2013 - 12:25pm

Investment firm Canaccord Genuity surveyed Pandora users who have tried iTunes Radio, to get a picture of its existential threat to Pandora. The survey’s headline indicates a limited downside to Pandora: “92% of iTunes Radio Listeners Still Use Pandora.” RAIN spoke with Michael Graham, author of the research note, to flesh out the survey’s conclusions.

It is important to note that the survey and its report are part of a “Buy” recommendation for Pandora stock, to the company’s investment clients. We asked Graham about the integrity of the research.

“We commissioned this survey from an outside party,” Graham told RAIN. “We had no influence over the who the respondents were. We presented the data as we got it. Obviously there are different ways to interpret it. But the data that we’re showing is raw.”

While the context gives this survey an agenda (Graham: “We’re bullish on Pandora”), it presents an interesting antidote to the fuzzy media math surrounding the iTunes Radio-vs.-Pandora comparison of audience metrics reported by the two companies. (See RAIN coverage here.) Apple recently announced 20-million unique users have listened to iTunes Radio, while Pandora cited 72.7-million active listeners were engaged with Pandora in September.

The research also peers below the pure number of listeners in each service, to discern the reaction and intent of those listeners when evaluating the two competing music platforms. Following are excerpts of our conversation with Michael Graham. 

RAIN: What was the purpose of the project, and the sample size?

MG: We surveyed 860 users, all “iDevice” [Apple] users. We asked them a few qualifying questions: First, are you an active Pandora listener? Second, are you using iOS 7? Third, have you tried iTunes Radio? We then asked them a few questions to compare and contrast the two services, and what their intentions were for future listening.

The purpose was to understand better how competitive the landscape is becoming. We’re bullish on Pandora stock. We’ve tried iTunes Radio extensively, and found it to have good and bad points. We wanted to see what consumers at large think of it. In the short term, we wanted to gauge what the impact would be of Pandora’s October audience metrics.

RAIN: What are the key takeaways?

MG: Number one, 92 percent of those who tried iTunes Radio indicated that they have gone back to using Pandora at least a little bit. Sixty-six percent indicated that they resumed using Pandora as much, or more, than before using iTunes Radio. About 40 percent said they are using Pandora more than iTunes Radio. This is significant. It means that a very small portion will listen to iTunes Radio and never listen to Pandora again. The others will probably fire up their Pandora account in October. So, short-term, we don’t think the October listener metrics [for Pandora] are going to suffer much.

Longer term, I think the implication is that there will be a lot of people using both services. If we roll forward the math behind all this, the eight percent portion of the addressable market that iTunes Radio can go after (not Android, Windows PC), we come to about one percent of the Pandora listener base that is at heavy-duty risk of leaving, and going to iTunes Radio. That’s a much smaller number than most people are scared of.

RAIN: Do the data indicate whether iTunes Radio is expanding the market for streaming listening, or merely is dividing the existing pie differently?

MG: We didn’t explicitly ask that. As a matter of fact -- our survey only questioned Pandora listeners, so we only determined whether iTunes Radio was dividing the market or not. My hunch is that it is expanding the market, and a big chunk of those 20-million [Apple-reported unique listeners] is incremental.

Weekend Perspective: Week Oct. 21-25

Friday, October 25, 2013 - 5:10pm

RAIN’s Weekend Perspective summarizes the week’s important events for a weekend catch-up, and revives your blasted synapses for coming week.

 

PARTNERSHIPS

Clear Channel and Black River: The radio group added to its growing portfolio of partnerships with record labels. Details not disclosed, but this one likely follows the template of Clear Channels agreement with Warner Music Group: higher broadcast royalties, lower streaming royalties, artist promotions on radio. [READ]

MUSIC SERVICES & APPS 

iTunes Radio reaches 20M listeners: And media outlets indulge in fuzzy math by comparing iTunes Radio and Pandora audience metrics, which use different standards. [READ

YouTube music service: YouTube is the gorilla in the room when it comes to music services. Not formally set up for music, the platform is nonetheless rampantly used for music search and playback, especially by young listeners. RAIN analyzes whether YouTube would compete with itself by formalizing a music service. [READ]

Sirius XM disappoints subscribers: Unexpectedly and without explanation, Sirius XM dropped several popular Clear Channel stations. The satellite company’s Facebook page swarmed with malcontent. [READ]

...and raises their rates: In its quarterly call to Wall Street investors, Sirius XM (SIRI) showed off steep gains in revenue and subscriptions from a year ago, but also lowered guidance for 2014 and raised rates on subscribers. [READ]

Twitter #Music nearing the end: Not official, but reports have us believe that Twitter’s music no-quite-service, underdeveloped but sometimes fun, and only six months old, will be shelved. [READ]

Microsoft plays the Web: Xbox Music was updated, and one new feature struck us as unique and potentially disruptive: a way of building a playlist from any web site that mentions artists and bands. [READ]

Rhapsody courts CD buyers: The music service gives one-month free subs to CD buyers at Best Buy. It’s an interesting play for consumers who might not be converted from ownership to access. [READ]

Songza updates: The Songza app is prettified for iOS 7. [READ]

“This American Life” goes endless: The public radio program, hosted by Ira Glass, has an 18-year archive of shows. A new TuneIn stream plays them continuously, with zero interactivity, for total saturation. [READ]

British music service sailing for U.S.: That would be Pure Connect, which works seamlessly with Pure WiFi devices. [READ]

ILLUMINATION 

Jim Lucchese: The CEO of The Echo Nest, a music intelligence company, describes how it powers many of the features used by millions of people across hundreds of music services. [READ Part 1] [READ Part 2]

DASH conference: A two-day conference in Detroit scrutinized every aspect of the connected-car movement, from the viewpoint of radio, solution providers, automakers, aftermarket companies, car dealers, and disc jockeys. RAIN was there. [DASH Day 1] [DASH Day 2]

OUTBURSTS 

Dave Allen vs. David Byrne: It’s a blog-debate. Settle in -- each of these gentlemen is voluble on the subject of Spotify. [READ]

 

RAIN Hotspots: Week of Oct. 21-25

Friday, October 25, 2013 - 11:45am

Here are the top five, most-read articles this week, published at any time. 

Sirius XM apparently drops stations, infuriates users: RAIN noticed that Sirius XM’s Facebook page was exploding with comments from outrages users, over missing stations in the satellite broadcaster’s channel lineup. We never got a response to several requests for comment from Sirius XM. [READ]

Sirius XM will reportedly drop Clear Channel stations soon: Related to the above, from which many readers clicked over for background information. Sirius XM remains in the news, having announced slightly higher subscription prices for 2014. [READ]

Apple announces 20-million iTunes Radio users; fuzzy math abounds: The Apple-vs.-Pandora media tornado got moving when Cupertino announced latest audience metrics for iTunes Radio. Problems arise when you compare apples to oranges. (See what we did there?) [READ]

INTERVIEW: Jim Lucchese, CEO, The Echo Nest: Readers settled into Part 1 of our conversation with the head of a powerful unseen force in music services. [READ] (Part 2 is here.) 

Microsoft’s new Web Playlist dismantles traditional “station” listening: Readers are interested in a unique new feature in Xbox Music that unleashes the hidden musical quality of web pages. [READ]

Apple announces 20-million iTunes Radio users; fuzzy math abounds

Wednesday, October 23, 2013 - 11:35am

After launching on September 18, simultaneous with the release of iOS 7 and baked into that mobile operating system, iTunes Radio has attracted 20-million users. Apple announced this milestone in a live product event on Tuesday.

Many media outlets are positioning the datum as a comparison with Pandora’s latest audience metrics report, which claimed 72.7-million active users in September. But quick conclusions of impending doom for Pandora, while not without speculative value, often disregard audience measurement realities.

The crucial distinction is between unique users and active users. Pandora does not disclose how it determines a threshold for active usage. But in all traffic and audience statistics, some level of repeat visitation is needed to turn a unique visitor into an active user. By the same token, Apple is not disclosing how many of the 20-million uniques are repeaters.

All repeat visitors are unique within the time period of their activity. But not all uniques are active with more than one visit. There is no industry standard for measuring loyalty, or a level of brand stickiness indicated by active usage. Slightly more than one month after launch, iTunes Radio might and might not have enough history for Apple to develop an internet metric of active usage.

One thing is clear: Apple is not announcing “active usage,” and comparing the “uniqeu” metrics with Pandora’s “active” metric is fuzzy math.

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