RENEE MONTAGNE, host:
Online music company Pandora went public yesterday, and investors gobbled up the shares. NPR's Nina Gregory notes all this excitement is for a company that has yet to make a profit.
NINA GREGORY: Pandora is a service that lets listeners customize online radio stations, and investors are likely relying on its popularity. The service has over 90 million registered users, which makes a potential for revenues from advertising high.
The company's revenues have been rising quickly, but analysts warn the company has a bigger and significant problem looming in its future. That would be the contracts it signed with record companies.
Those contracts expire in a few years. Mike McGuire is a media analyst with Gartner and says despite that, Pandora has seen important growth in the mobile market.
Mr. MIKE McGUIRE (Media Analyst, Gartner): You cannot ignore the popularity of the product, and I think even those folks at Pandora would point out that, you know, a lot of the recent growth was due to getting that app on the version of the iPhones that came out, and a lot of the smartphones that have come out since.
GREGORY: Pandora is in the top five most used apps on all four smartphones, and is the number one most downloaded free app on the iPad.
Nina Gregory, NPR °µºÚ±¬ÁÏ. Transcript provided by NPR, Copyright NPR.
