Facebook Inc. (NASDAQ:FB) may already have an alliance with music-streaming service Spotify, but the progress made in mobile advertising by Spotify rival Pandora Media Inc. (NYSE:P) may make that company a fitting partner for the worldwide social network as Facebook continues to be stunted by mobile. If not a partnership, then could Pandora lend some clues to solving the mobile advertising mystery that has dogged Facebook all this time?
While Pandora Media Inc. (NYSE:P) has not been a money-maker – it reported a break-even mark for the quarter that ended in July, but it expected to be in the red for the fiscal year – it has made strides in mobile advertising, which has been a perpetual bugaboo for Facebook Inc. (NASDAQ:FB). The evidence of this comes in the top line of the company’s earnings, as revenue in Pandora’s most recent quarter rose by 51 percent from a year earlier to $101 million – and more than half of that revenue was reported as coming from mobile advertising sales. However, while Pandora hasn’t entirely figured out mobile, it is definitely showing more progress in that area than Facebook Inc. (NASDAQ:FB) has been able to muster.
Could this potentially mean that Facebook Inc. (NASDAQ:FB) may at least approach Pandora Media Inc. (NYSE:P) for some intelligence about mobile advertising, or even make a takeover play and merge Pandora’s music-streaming service and mobile advertising platform into the current Facebook infrastructure, which now includes Instagram for photo-sharing? While it might be too early for anything to happen – especially since Facebook Inc. (NASDAQ:FB) has a recent alliance with Spotify that is burgeoning, to know that Pandora’s mobile revenue in the last quarter was up 81 percent from the previous year and that 90 percent of that revenue came from advertising, there may be some utility for Facebook to have some kind of relationship with Pandora Media Inc. (NYSE:P) to try to solve the mobile problem that is hampering Facebook’s stock price and growth. Any edge Facebook can find in breaking through on mobile devices would likely be welcomed by investors like hedge-fund manager George Soros of Soros Fund Management.