Can iTunes Radio Change the Music Streaming Game?

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Sept. 30 (Bloomberg) -- Joe Levy, publisher at Billboard magazine and Michael Pachter, analyst at Wedbush Securities, examine the impact of iTunes radio as 11 million users have sampled the service, the advantages held by the iTunes and Pandora services and the crowded field for streaming music. They speak on Bloomberg Television’s “Market Makers.”

We have a guest in los angeles.

Joe, levye levy is here with us in new york.

Itunes radio, 11 million users already.

That is a one-week number.

Incredibly impressive, of course.

Here is the question.

One month from now, how many of those 11 million who tried it out are still using it?

That is an important question.

Can apple continue that growth and catch up with pandora's 70 million active users?

Michael, what do you think?

I think 11 million is unimpressive, given there were 200 million downloads.

Until you asked me to be on the show, i was one of those people who updated and have not yet bothered to try itunes radio.

I think this is early days.

Apple is trying to be all things to all people.

The service, according to reviewer's, is not as good as pandora.

I think those that like pandora will not change, but there are a ton of iphone owners who will give it a shot.

190 million people that have not tried it.

Ultimately, you will see it get some traction.

I have experimented a little bit but i am not a hard-core pandora fan.

How was that lead time -- with all of that lead time, how could they produce an inferior product?

Pandora probably caught lightning in a bottle and got it right.

There is an actual answer to why pandora is in the lead.

I am a reviewer and it is a better product right now.

They have millions more users who have been using the product longer, they have an algorithm that has learned from thumbs up, thumbs down.

There are millions like you whose taste they can draw on, and they can serve you materials.

Where does spotify fall in all of this?

Spotify is distant in the streaming radio field.

Here is why people are excited.

The majority of internet music users say they want the lean back, listen experience.

They do not want to say i want to listen to this album right now.

Rick rieder, chief investment officer of fundamental fixed income portfolios.

, do you use pandora radio?

I have not tried it.

I do use pandora, but i like slacker.

It has a wider array of songs, has actual djs, seems to be a better fit.

What does it mean for itunes to have someone like justin timberlake signing on and being a part of their music festival?

Alicia keys tied herself to blackberry, and that did not do anything.

You mentioned these services.

Slacker has a curated team of djs.

They have a spotify-like service.

I also like rhapsody.

They have a discovery service which we all agree is not as good as pandora.

We listen to music a lot of different ways, so justin timberlake could be what howard stern was too serious.

-- to sirius.

If they give me an overall experience, sometimes i like your, maybe i was which over.

Sometimes i will pick my own songs.

One of the advantages that itunes has -- take one look at the man and you think, rhyming.

I did not know what i was getting myself into.

Itunes is the biggest music retailer in the u.s., biggest globally.

They can leverage those relationships.

They already stream albums on itunes.

They are shifting that to radio.

If you are an artist fan, there is a lot of content there.

They will have exclusives that one drive their business forward.

To your point, maybe itunes radio does not need to become bigger than pandora, but it is because they can drive these additional revenue streams out of it.

If they really want to drive, they need to be better.

It is early days.

Look at ios7, it is better.

There will be an update to this in a few months.

They will learn a lot about what we like, it will get more relevant.

I think it will get better.

Better than pandora?

I doubt it.

This is a chance for apple to forcibly enter the advertising market.

That is a big advantage.

Big advertisers moving in.

The minute i started using it, i started to get ads forwarded to me.

This is their opportunity to get it right.

There is a pepsi radio station on itunes radio.

I think you are talking about small numbers.

Pandora is doing $600 million in revenue.

Itunes will do 60. maybe someday, but i do not think they will move the needle for a few years.

Thank you, michael.

This text has been automatically generated. It may not be 100% accurate.


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