Has Pandora’s exit from Australia helped iHeartRadio’s fortunes?

A report in Ad Newssays that Pandora’s departure from the Australian market last July has been a total boon for Australian Radio Network (ARN)’s podcast platform iHeartRadio.

Reports were that 5 million Australian and New Zealanders had to find a new option after Pandora shut up shop to concentrate on the U.S. market.

It had apparently been adding 20,000 users a week in Australia.

So where did those users go?

Apparently to iHeartRadio, according to ARN CEO Rob Atkinson who says there’s been a huge spike in listeners since.

This is particularly so in its curated music and artist playlists, one of Pandora’s major draws.

“Our listening has gone up tenfold on the basis that it’s the closest thing to Pandora,” Atkinson told Ad News.

“People who were listeners of Pandora wanted to go on, wanted to listen to their favourite artist like Lady Gaga or Bruno Mars, and then of course they want the algorithm to do all the work for them rather than customise their own playlist.

“So, we’re probably closer to the Pandora offering than anything else in the market and that’s what is driving registration.”

Atkinson added that this incentivised ARN to offer more personalised ads in iHeartRadio to increase its revenue.

“More and more of our listeners are seeking and trying to discover our content on multiple channels, multiple devices and we have got to give them that option.

“And we are the only player in the market with a ready-made audio platform in iHeartRadio.

“You can imagine the amount of access to data rich information we get on that platform, which is going to obviously enhance our audience targeting and increase our accountability.”

While iHeartRadio is benefitting, Pandora Media, is having problems in the United States.

Earlier this week, its shares fell 6.2% after major investment company Morgan Stanley downgraded the stock and raised concern about the company’s revenue growth for 2018.

“Growing ad revenue in ’18 is no longer a given as Pandora faces engagement and monetization challenges,” said analyst Benjamin Swinburne.

“We thought Pandora could potentially reach 10% advertising growth in ’18.

“However, we now expect 2017 to show a nearly 15% decline in listening hours, an over 5% decline in ad supported monthly active users, and slower growth in advertising ARPU.

“This leads us to lower our outlook for ’18 ad growth, now forecasting flat to up modestly.”

Swinburne added that the slowing down of ad revenue growth “meaningfully reduces the company’s ability to drive any operating leverage.”