Pandora: Apple Doesn’t Scare Us

Pandora (NYSE:P) says it is not worried about the possibility of Apple (NASDAQ:AAPL) launching a rival to its online music radio. Media reports last month suggested that the iPhone maker was contemplating creating a service catering to personalized music tastes, leading to uneasiness in Pandora’s shares.

However, Pandora founder and chief strategy officer Tim Westergren told USA Today in an interview that the radio had faced down big rivals before and held its own. While Apple would provide “some serious competition … we haven’t lacked for competition,” Westergren said.

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The founder cited the example of iHeartRadio, which was relaunched as a personalized music service last year by Clear Channel. “Our growth wasn’t slowed,” Westergren said.

While Pandora currently has over 160 million users, it has not reported a profit since its IPO in June 2011 because of the high royalties it has to pay to musicians and record labels. The radio earns revenues through advertising. “The fact that large companies are turning toward our space means we’re doing something right,” Westergren said. “What we do is incredibly hard. For 12 years we’ve had trained musicians come in, slip on headphones and manually analyze over 1 million songs … Hopefully we make it look easy for the listener, but the technology behind creating a playlist is incredibly complex.”

Microsoft (NASDAQ:MSFT) also made its entry into the streaming music field with its Xbox Music service earlier this month. Westergren said he was focused on making his product better. “Listeners will gravitate to the service that plays the best songs for them. It’s winner takes all.”

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