Pandora tops 60 million users, mobile growth strong

"We're definitely on a steep growth curve right now," said Tim Westergren, who founded Pandora in 2000 and now serves as chief strategy officer of the Oakland, California-based company.

"We just passed 60 million users and I've never advertised," Westergren told technology and media executives at the Fortune Brainstorm Tech conference here. "I've been a beneficiary of this incredible viral phenomenon online."

Westergren said Pandora, which creates personalized radio stations for users based upon their favorite artists or songs, was seeing booming growth on mobile devices.

Pandora is available for the iPhone, the Blackberry, the Palm Pre, and devices running Google's Android and Microsoft's Windows Mobile operating systems but does not currently provide service outside the United States.

"We're growing faster now on mobile than we are on Web and the reason people give us is because that's how they want to listen to it," Westergren said.

"We get about 90,000 new people a day activate Pandora on a mobile device and that number is growing," he said. "Android is a very fast grower."

He said the next step for Pandora would be "getting into cars and into electronic devices at home."

"We're experiencing what I think is the beginning of a big shift where Internet radio is about to really start penetrating the entire spectrum of where radios are used," Westergren said.

US automaker Ford is already integrating Pandora into selected models.

Asked about the success of Pandora, which is free and supported by advertising, compared to online subscription music services such as Rhapsody, Westergren said the average American listens to about 20 hours of music a week -- most of it free radio listening.

"Historically, 17 of those hours have been radio and that still is true in spite of all these wonderful on-demand ways to listen to music you own on iPod, etc," he said.

"Our company's entirely focused on those 17 hours," he said. "Rhapsody and its kin are really about those three hours that you own, the on-demand part.

"Fundamentally, we're not huge believers in subscription," Westergren said, although Pandora does offer a paid premium service which allows for unlimited listening beyond the monthly 40-hour limit on free accounts.

"I think it's really hard to get people to pay for stuff," he said. "The history of subscription in our space has been rapid growth up to a certain point and then you reach saturation."

Westergren said Pandora's biggest competitor remains broadcast radio. "They own 90-plus percent of the market," he said.

The Pandora founder also addressed the recent flap over the integration of Pandora and Facebook accounts which raised privacy concerns for some users.

"Some people were a little bit upset about that," he acknowledged, and "we spent a lot of time over email with a small number of listeners working through it."

He said he remained convinced that a lot of people do want to know what music their friends are listening to and receive musical recommendations.

"I think it's got a very promising future but it's definitely something you have to tread carefully with, do it right," Westergren said.

(c) 2010 AFP