chris corson

Analyst dumps on Pandora Media again

26 September, 2011 12:00:00

Richard Greenfield at BTIG has never been a fan of Pandora Media, panning the streaming audio company even before its IPO. Now the bearish analyst has turned even more bearish on the stock. “We view social as one of Pandora’s key problems,” Greenfield wrote in his latest analysis. He doesn’t think the latest redesign of Pandora’s website is up to snuff on the social media side and notes that Pandora was notably missing as Facebook announced new music partners. So even as the BTIG analyst increased his short-term financial estimates for Pandora – notably, he’s now expecting the company to turn cash flow positive this year – he’s maintained his “sell” rating on the stock and lowered his target price to $3.75 from his previous $5.50. Pandora closed Friday (9/23) at $10.75.

 The release of the new iHeartRadio personalized radio service by Clear Channel was one example of new competition that prompted Pandora to eliminate the usage cap on its free service. Greenfield figures that “evaporated” a key benefit of Pandora’s subscription service, so he expects a secular decline in that side of the business. So he’s pulled back on his revenue growth estimates over the next four years, but increased his listener hours estimates. That means higher music royalty payments and lower profits in the long run.

 RBR-TVBR observation: Pandora’s boosters tend to be totally focused on top line growth, both in ad sales and listener sign-ups, ignoring the huge royalties that Pandora has to pay to SoundExchange, regardless of whether it manages to sell enough new ads to cover new listening.

The bet seems to be that some larger company (Google or Microsoft, for example) will want to buy it because of its growth rate. But we’re pretty sure that those Internet giants have bean counters who know how to tally royalty payments as well as the metrics that Pandora executives prefer to focus on.

Video: A look at who is watching what where

06 August, 2011

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If you are watching television right now, you could be absolutely anybody – watching television is an almost universal activity in this day and age. But the odds are, you are in the 65+ age cell, and your ethnicity is African-American. But according to the latest report on the topic from Nielsen, no matter who you are, despite an ever-increasing number of platforms from which to access video programming, the odds are still that you are watching a tradition pre-scheduled television program over an actual television.

According to Nielsen, senior citizens watch twice as much traditional television as the teenage crowd and almost 40% more than the 35-49 demographic. Meanwhile, African-Americans  are racking up 213 hours of television viewing montly, 57 more hours than Whites and double the traditional TV viewing of Asians.
Asians, however, are the #1 group when it comes to viewing video over the internet, racking up six more hours monthly than whites and four more than the #2 group, Hispanics.

As for cord cutting, Nielson does not believe it is a serious threat to the three principle members of the MVPD business. It says 91% of all Americans are still willing to pay a subscription fee for access to programming. However, Nielsen notes that what does seem to be taking place is a certain amount of churn as consumers switch from one delivery method to another.

The average time spent with video programming for Americans aged two or older is 44 hours and 25 minutes, according to the study. Of that, 35 and a half hours plus a few minutes is spent on traditional TV. About two and a half ours is time-shifted viewing, five and three quarters is internet viewing, a half hour consists of watching internet video, and a scant seven minutes is viewed over a smartphone.

It they stayed awake an extra 43 minutes on average, while in front of the T, the 65+ demo would have clocked in with 50 hours of weekly traditional TV viewing, compared to 24 hours 21 minutes logged by teens. Teens, on the other hand, are the biggest phone streamers, but the usage is minimal, only 20 minutes weekly.

African-Americans have almost as prodigious an appetite for traditional television as do seniors, logging in over 47 and a half hours weekly. Hispanics are only 42 minutes over the 30 hour benchmark, by contrast.
The biggest users of computer video are the 35-49 and 25-34 demographics.

On a monthly basis, African Americans view almost 213 hours of traditional TV, followed by Whites (155 and a half hours), Hispanics (135 and three quarter hours) and Asians (100 hours).

By contrast, Asians are by far the leaders in internet video use, logging in over 10 hours monthly, compared to more than six hours for Hispanics, just under six hours for African Americans and less than four hours for Whites.

Whites, however, make the most extensive use of time-shifting, almost 27 hours worth, compared to 24 hours for Hispanics, 22 and three quarters for Asians and just over 22 hours for African Americans.