Internet radio has finally gone mainstream, yet the market leader Pandora faces all kinds of challenges when it comes to turning a profit – everything from royalty fees it must pay musicians to an impending challenge from Apple.


The recording industry has moved light years from the days when everyone listened to FM radio and bought compact discs at the mall music store. But in some ways, the song remains the same. Today, Pandora sits at the heart of a controversy about artist compensation, even as it continues to break new musical ground.

200 million listeners can’t be wrong

Pandora has been around for more than a decade, helping people discover new music based on their individual tastes. As you enter more songs, the service learns more about your preferences and can recommend other tracks ranging from the well-known to the obscure.

For example, you can start a blues station by typing in an artist like “Son House.” You’ll get a song like “Preachin’ Blues” and see a list of related artists like Robert Johnson, Blind Boy Fuller, Mississippi Fred McDowell and Lightnin’ Hopkins. Then you can shuffle to other Son House songs or add other blues artists as you refine your station and provide data about exactly what music you like.

Pandora allows you to create and refine up to 100 unique stations that you can listen to on your mobile devices or in your automobile. You can listen for free or pay a small amount to not have to listen to advertisements. This recipe has led to tremendous growth – at least in terms of users.

This month, Pandora announced that it now has more than 200 million registered listeners after reaching half that amount just two years ago. Pandora now has more than 400 curated genre stations (compared to less than 40 genre formats on FM radio). While Pandora has more active users than Spotify, it doesn’t have as many songs as its Swedish rival.

Apple apprehension

Launched back in 2000, Pandora has been credited with reinventing radio – but with little to nothing to show for it in terms of profits. And then there’s Apple, that tech titan that no one really wants as a competitor. Apple has been getting all kinds of headlines about a product called iRadio, be a streaming music service that would be similar to Pandora in some ways. If that weren’t bad enough, Google reportedly aims to launch a streaming music service this summer as a YouTube product.

So, what are your thoughts about Pandora’s chances of turning its popularity into long-term profits? Will Apple or Google one day topple the leader in Internet radio? We’d love to hear your thoughts about Pandora or streaming radio in general.