This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Apple Radio Should Pump Up Heat on Spotify, Not Pandora

But, get this, the Apple Store located just a few blocks from me in Santa Monica, Calif., generated $352 million in sales in fiscal 2011, according to MacDailyNews. That's almost a million bucks a day. And that's just one store.

The revenue Apple would derive from ad-supported streaming radio (or a subscription service for that matter) doesn't amount to beans. It's not worth the hassle or the very real risk that it will be a flop.

It takes more than the flip of a switch to credibly challenge Pandora in this area. The company dominates Internet radio listening with a two-year head start in building out a local sales team to tap the $14 billion traditional radio ad market.

Plus, it does personalization and discovery incredibly well; you cannot duplicate the Music Genome Project, a complex and beyond-obsessive algorithm more than a decade in the making, overnight.

All of that said, whatever goes down will go down.

It might require a long memory, but remember this: If Apple does a service that competes head on or in spots with Pandora, it will be a long-term net positive for Pandora.

Not even Apple can stop Pandora's growth in the space, both from ratings and ad revenue perspectives. If you assess Apple vs. Pandora on the surface, you'll snap that I'm insane. However, If you truly study what Pandora does and why it leads Web radio by such a wide margin with a strong first-mover advantage in mobile use and advertising, the picture looks a heck of a lot clearer.

Purely on noise and legislative uncertainty, I can't say you should buy Pandora shares now. Trade it if you're nimble or accumulate on crashes and write covered calls, although my near-term sentiment might change as we get deep into 2013.

Rocco Pendola is TheStreet's Director of Social Media. Pendola's daily contributions to TheStreet frequently appear on CNBC and at various top online properties, such as Forbes.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
AAPL $128.46 0.00%
P $14.80 0.00%
FB $78.97 0.00%
GOOG $558.40 0.00%
TSLA $203.34 0.00%


DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs