Is Apple's iTunes Radio About to Crash Pandora's Party?

By Andrew Tonner – Sep 24, 2013 at 10:30PM

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After only a few days, Pandora investors seem spooked.

The market had largely ignored the potential ill effects that tech giant Apple's (AAPL -0.26%) recently launched iTunes Radio could have on streaming radio leader Pandora Media (P) -- until Monday, that is.

Only days after launching the service, Apple rocked Pandora investors by announcing iTunes Radio had already logged an impressive 11 million users. Pandora investors headed swiftly for the exits, giving Pandora shares more than a 10% haircut in the process.

And while 11 million users is a fraction of Pandora's installed base, such swift adoption by so many people bolsters the idea that Apple's new service is a serious contender.

So, will Pandora's recent slide continue? In this video, Fool contributor Andrew Tonner gives his reasoning as to why Pandora's pullback should just be getting started.

Fool contributor Andrew Tonner owns shares of Apple. Follow Andrew and all his writing on Twitter at @AndrewTonner. The Motley Fool recommends Apple and Pandora Media. The Motley Fool owns shares of Apple. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.