With the revelation last week that tech monolith Apple is poised to develop a streaming service similar to that offered by the popular Pandora, reaction is flying across the Internet faster than, well, faster than the new iPhone (released tomorrow) will likely sell out.

In the PC Magazine article, “How Can Pandora Save Itself?,” writer David Murphy attempted to answer his own question by suggesting that Pandora needs to stop shooting itself in the foot, by paying more royalties, the more users it attracts.

“If Pandora somehow successfully convinces U.S. lawmakers to reduce music licensing rates, it could be a big feather in Pandora's cap as it pushes toward profitability,” Murphy writes. “And, above all else, Pandora could also add more commercials and advertising to its services.”

However, there are those like Mark Ramsey, president of Mark Ramsey Media LLC, who don’t necessarily believe that Apple poses an insurmountable threat to Pandora.

“I don't think there's any sign (Apple is) reaching too far as long as they continue to solve consumer problems the way we want them solved.  I don't know that this locks out any competition - in fact, I think it invites it,” he told Radio World in an email.

According to Ramsey, it simply makes good sense that Apple is getting into the streaming music business. He adds that Google and Microsoft would be wise to follow in the same vein.

“Apple's move might be the biggest challenge to music radio possibly ever,” he says. “Or it might simply be the new Ping. I would put my money on Apple on this one.”

As for the potential effects that Apple’s new venture could have on terrestrial radio, Fred Jacobs of Jacobs Media told Radio World in a phone interview that station managers shouldn’t expect to suffer to the same degree as Pandora or Spotify.

Still, the move should not be ignored, but taken as a “wake up call.”

That one of the world’s most successful companies is interested in this business is “just one more acknowledgement that the streaming space is really important,” he says. “Broadcast stations that play music need to think about what’s their defining difference. Why would people listen to FM music stations in this environment? What does FM radio bring to the table that Pandora and Spotify don’t?”

Terrestrial radio needs to take stock of its assets and shortcomings in an increasingly digital world, Jacobs says. “All of these things force broadcast radio to take a look in the mirror and think about what is the whyof FM music radio at this point … There are some times where you don’t want a DJ and you don’t care if it’s local and you just want music. And that’s great. But what is it that we do that’s uniquely different?”

Unfortunately, when it comes to digital, broadcast radio is often simply “playing defense,” Jacobs says. So radio stations shouldn’t necessarily copy what Pandora does (and what Apple is now set to do), because it’s likely that radio won’t be able to come up with better form of personalized music playlists. The key, according to Jacobs, is to focus on what terrestrial radio does offer that’s uniquely valuable.

One way to do that, Jacobs suggests, is by “investing in personality” and using social media to connect in meaningful ways with listeners and advertisers.

Jacobs says that he has trouble believing that people will simply stop listening to Pandora, just because Apple comes out with a similar product (one which will undoubtedly have a cool factor).

“Can (Apple) create the greatest pureplay radio service ever? I guess maybe they can, but it’s not like everything they do is going to be so unique that we’re like, ‘Wow we’ve never experienced something like this.’”

Mark Ramsey says that those who dismiss its service as “not real radio” should reconsider.

“What do we know about providing a radio-like experience that's music based?  We know it's not that complicated and there are relatively few differentiators between one service and another - the main differentiator, in fact, is distribution - you either have it or you don't,” he says. “Historically this has been one of radio's great strengths. Distribution for Pandora is still on the upswing.  But consider Apple's distribution - or Google's or Microsoft's or Amazon's. Vast.” 

Incidentally, Jacobs Media did a nationwide tech survey of 170 commercial stations in the U.S. and Canada, earlier this year, and asked the million dollar question: does Pandora qualified as radio? Response was split almost down the middle: 43 % said “yes,” 49 % said “no.”

Relevant links:

Apple Seeks to Create Pandora Rival, Wall Street Journal  

Apple Plans To Challenge Pandora In Web Radio