Evidence of an Internet radio battle will have to wait a month. Pandora released statistics for September that show small, positive gains in both listener hours and monthly active users. Apple's iTunes Radio launched September 18th, giving the service less than two weeks to impact the Internet radio leader.
Last month, Pandora had 1.36 billion listener hours, up 0.7% from the previous month and up 18% from the prior-year period. The service attracted 72.7 million listeners in September, up 0.8% from August and up 25% from the prior-year period. The September gains were relatively small but not out of the ordinary for Pandora. The only factor that has made a noticeable -- and negative -- impact on Pandora's growth was the company's implementation of mobile listening cap.
The news sparked a rally on Wall Street. In early afternoon trading, shares of Pandora were up 6.3% to $27.14, just below the all-time high of $27.50.
A strong start by iTunes Radio has fueled speculation that Pandora's market share could be eroded. Apple revealed that over 11 million people had tried iTunes Radio in its first five days. However, two unanswered questions remain: How many of those 11 million people will become recurring iTunes Radio listeners and how much will they listen?
Geography is a factor when trying to assess iTunes Radio's impact on Pandora. Some of Pandora's current growth is undoubtedly coming from outside the United States. Pandora also operates in Australia and New Zealand, although the two countries probably don't account for much of the service's total footprint. iTunes Radio is currently available only in the United States. Billboard has reached out to Pandora about its growth in the two countries. No response had been received at press time.
Geography is a factor when trying to assess iTunes Radio's impact on Pandora. iTunes Radio is currently available only in the United States. Some small percentage of Pandora's current growth is undoubtedly coming from its two newest markets, Australia and New Zealand, although the company does not break out usage statistics by country. The two countries have only 27 million citizens between them -- about 8.5% the population of the United States -- but adoption in relatively small numbers would help push Pandora's usage statistics in a positive direction.
Pandora has built a large lead over its Internet radio competitors. According to Triton Digital figures for August, the latest month available, Pandora was the leader with 911.9 million session starts. Clear Channel was a distant second with 167.9 million session starts during August, followed by Cumulus Streaming Network with 23.9 million and Slacker with 34.8 million.
But Internet radio has plenty of growth potential, and Pandora's lead hasn't kept smaller webcasters from trying to grab market share. Songza just raised $4.7 million to help its native advertising business. Earbits has signed up 12,000 independent artists and over 600 labels. Radionomy, based in France and available in the United States since September 2012, now streams more than 45 million hours per month.