NEW YORK (TheStreet) -- For some Wall Street analysts, it becomes personal and emotional. Or at least that's how they make it appear.Quite frankly, BTIG Media analyst
Recent ActivityJune 11: Pandora closes at $11.15. June 12: Greenfield starts the Songza hysteria by noting the Internet radio company's surge to the top of Apple's ( AAPL) App Store charts. He even posts a YouTube video showing how great Songza is. Pandora closes at $10.49. June 13: The rest of the media latches onto the flimsy Songza hype. Pandora closes at $9.90. June 14: The media-manufactured spectacle subsides. Pandora recovers, closes at $10.42. June 15-18: Pandora continues move up, closing at $11.47 on Monday. June 19: Greenfield out with a cautious mention on Pandora because Spotify will make its streaming service free on iOS apps. Pandora tanks as low as $10.67 intraday. Until Greenfield or somebody else files a "note" akin to pulling a fire alarm in a high school hallway, expect Pandora to recover once again. It's already on its way.
Pandora programs music based on a complex algorithm based on songs' musical "DNA." Which means that if you tell Pandora you like the Ronettes' "Be My Baby" it will find other songs that feature "rock & roll roots," "a subtle use of vocal harmony," "acoustic rhythm piano," etc. But Spotify says it is relying on the "social graph," so it will find music that people who like the Ronettes also like.. And that's seven screens' worth of "etc." But, bottom line, what Kafka points out is critically important. While the barriers to enter Internet radio might be soft, it takes years to present it the way Pandora has. And you do not simply build the necessary infrastructure or scale to meaningfully penetrate an establishment like the radio advertising industry overnight. Beware of analysts like Greenfield. They need to spend more time assessing the work a company actually does as opposed to wasting away their days refreshing the Apple App Store rankings and shooting YouTube fan videos. At the time of publication, the author was long FB and P. Follow @RoccoPendola