NEW YORK (TheStreet) -- It's no wonder it took so many so long to get a handle on the Pandora (P) story. And why, even still, the remaining bears and even a bunch of bulls, have no idea what the hell is going on.

When you have people like

Slacker

CEO Jim Cady feeding the media misleading statements, it shouldn't surprise us that large numbers of people misunderstand Pandora and the broad Internet radio space.

Here's Cady's reaction to

Pandora's solid earnings report

from last week:

"Pandora grew revenue but will continue to struggle with profitability until they rethink their licensing structure," said Jim Cady, CEO of Slacker. "Controlling costs by punishing users with a listening cap is a dicey strategy; we're seeing our audience grow by 10-15% in the second half of every month as Pandora users hit the cap and come to Slacker."

"Slacker's model allows us to be margin-profitable on every user, free or paid, no matter how long they listen," Cady added. "Expanded content rights allow us to complement our ad-driven business with a higher-margin subscription service that delivers on on-demand plays, offline listening, unlimited track skips and more, which Pandora can't offer."

This "commentary," as the PR agency that sent the email calls it, shows that Cady, as leader of a pretty good Internet radio company, is either being disingenuous or he, himself, has no idea what he's talking about, particularly with respect to Pandora's business. I can't possibly cover every thing that's wrong with what Cady said, so I focus on what I consider most important.

Also see: Pandora Isn't the Enemy, the Music Industry Is, Part 1 >>

First, Slacker should probably give itself more credit. While I wouldn't necessarily run around touting "10-15%" increases in a dynamic, hyper-growth sector such as Internet radio, the company's aggressive advertising campaign over the last several weeks, not Pandora's actions, likely has quite a bit to do with the modest bump.

Pandora is "punishing listeners," according to Cady. It's some punishment to let the few users who hit the 40-hour per month mobile listening cap know they can continue using Pandora on mobile by paying 99 cents (

that's ninety-nine cents!

) for the remainder of the month or converting to an annual $36 Pandora One subscription.

Also see: Pandora Must Promote Indie Artists, Expose Music Industry Injustice >>

Likely more relevant than Cady's "10-15%" boast is Pandora's 114% year-over-year increase in Pandora One subscribers. The company added more than 700,000 apparently "punished" souls to its subscriber roll in Q1. The cap did exactly what it was supposed to do: It decreased the percentage of revenue Pandora spends on content marginally (from 69.1% to 66% sequentially) and it brought in more subs than the company expected.

Mobile revenue is up 97% year-over-year and, equally as important, it outpaced mobile listening hours. That's exactly what Pandora wants to see happen. And that's exactly what CEO Joe Kennedy has been saying on conference calls for more than a year. Does Cady listen to any of this?

Cady is correct on one point -- listeners have more versatility with Slacker than they do Pandora. They can do on-demand and such. But that's the distinction between Pandora as pure-play Internet radio and decidedly on-demand services such as Slacker.

Also see: Why Radio Is the Last to Play the Biggest Song of the Summer >>

How can I get down on members of the media and listening public when they don't seem to comprehend the nuances of the space as cats such as Cady fill their head with misinformation?

It's sad. Sad because Cady should not rip Pandora the way he did. It's one thing to use attack ads. Personally, I liked them. They brought back memories of great battles between broadcast radio stations in terrestrial's heyday. And I hope the marketing helped grow Slacker's audience. More power to Slacker if they brought some Pandora listeners over, but Cady shows a fundamental misunderstanding of Internet radio if he thinks the choice to use Slacker amounts to a Pandora rebuke.

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--

Written by Rocco Pendola in Santa Monica, Calif.

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

.