NEW YORK ( TheStreet) -- I don't understand why Apple ( AAPL) would do this, but I hear it's only a matter of time before it unleashes a Pandora ( P) competitor called iRadio or something of the sort.I bounced the idea off Albert Fried and Company analyst Richard Tullo, who covers Pandora and is a frequent Bloomberg TV contributor. Tullo thinks iRadio ends up a bigger threat to Spotify than Pandora: "We think Apple will adopt some Spotify-like features if it can in its iTunes platform as it's really Spotify which is the direct threat." So, not a full-blown streaming Pandora competitor. That makes more sense. It gets ignored by the largely bearish financial media, but iTunes and Pandora are complementary services; iTunes and Spotify are clearly competitive. Historically, Apple has had a fantastic relationship with Pandora, featuring company executives at the iPhone launch and including Pandora prominently in the recent iPad event. Pandora consistently ranks as one of the top free apps and top grossing apps in Apple's App Store. By contrast, earlier this year at an AllThingsD conference, Spotify board member and investor Sean Parker claimed Steve Jobs tried to block Spotify's entry into the U.S. Tullo doesn't think Apple will do a streaming service because getting into the business makes no sense:
"The idea driving my view on Apple is that they make enormous margin from storage and the iTunes. The adoption of the streaming model for Apple is akin to the business development decisions of the Yellow Pages and newspaper industries which bankrupted not a company or two but entire industries."Throw logic out the window, though. It rarely prevails in Pandora conversations. BTIG Media analyst Richard Greenfield deserves partial blame for the inanity. Greenfield releases "cautious" notes on Pandora regularly. He's almost certain to spew bearishness to compound a bad news report or follow up something positive. That's exactly what he did last week shortly after I wrote two long-term bullish Pandora columns for TheStreet, including " Spotify Has the Bad Business Model, Not Pandora". Of course, Greenfield thinks Apple will do streaming radio. He believes it will effectively put Pandora out of business. Tullo scoffed at Greenfield's analysis:
"Apple cannot and will not go into this business on a whim like Greenfield suggests. If Greenfield thinks a company that cannot get you to Hoboken from Brooklyn is going to develop an ad network canvassing every user by location and every advertiser after just firing all its major developers, his ego has clearly grown beyond his media acumen. My guess is he is better serviced applying for the Jets GM position because clearly Woody Johnson would appreciate his insights based on the Jet's recent decisions."Think about it. Let's just say Pandora does $400 million in revenue in fiscal 2013. That would be a pretty strong showing for the company.