Forbes predicts 120 million active users for Pandora within six years; could it happen?

pandora logo crystalForbes published an article with predictions about Pandora’s audience base, estimating that its number of active users would grow from 76.2 million in 2013 to almost 120 million during the next five or six years. That’s a bold prediction, especially considering that Pandora actually posted a small dip in monthly active users in its second-quarter conference call. The column based that expectation on the current projections for smartphone growth and connected cars, as well as the possibility of Pandora making international expansions.

The streaming radio service’s push into new markets could align nicely with the uptick in smartphone use. Mobile listening is very popular among Pandora members, and after seeing early success with its entrance into Australia and New Zealand, it makes sense that the service would want to follow on the waves of smartphone adoption in emerging markets. Forbes noted this as a likely scenario, although Pandora has been tight-lipped on where or when it might make another move. In its Q2 conference call, Pandora CEO Brian McAndrews fielded many questions about the company’s international plans. His answers were stock and unrevealing, but the many questions implied that investors eye territorial expansion as a field for audience growth.

The move into car listening seems to be the wild card in Forbes’ predictions. We already know that Pandora takes connected cars seriously enough to consider programming changes. Based on statements by Heidi Browning, Pandora’s vice president of strategic solutions, the streaming service is pre-installed in about a third of all new 2014 car models. Forbes reported that Pandora’s outlook in comparison to satellite radio leader Sirius XM is uncertain, but noted that it would likely take away some listening hours from terrestrial radio services. Past studies have shown some uncertainty and mixed feelings among auto buyers about connected cars, so a clear adoption path would assist adoption in the car.

How realistic is Forbes’ assessment? Thanks to Pandora’s well-established name, penetrating new markets could yield growth in audience size. Those new markets could be geographic or vehicular; both have the opportunity substantially increase Pandora’s slice of the pie. But while the company has been vocal about its interest in connected cars, it’s tough to expect such a huge jump in listeners without a guess as to what Pandora’s international plans might be, if any. Keep in mind that during Q2, audience metric dropped slightly from 77 million active listeners to 76.4 million. That’s a small decline, but listeners have a vast buffet of options for where to get their music, and Forbes notes that future growth will probably not repeat the historic 130% audience surge of 2010-2013.

Anna Washenko