While it looks to boost advertising revenue, Pandora...

Wednesday. In the car in particular, terrestrial radio has “abused the consumer … because there was nothing else for them to really listen to, and they chased every last dollar down,” Paschel said. Pandora began in-car advertising in January and is sold out for the rest of the year, he said, but the company can draw on ad revenue from other segments of the business. Paschel said the maximum number of ads Pandora serves per hour is six -- and fewer in the car -- compared to roughly 15 minutes of ads per hour for terrestrial radio. “You don’t race from zero to six … all of a sudden,” he said. The ad load is being gradually increased on Sonos and other embedded platforms, he said. On the desktop PC, Pandora can monetize visually as well when consumers look at the screen to press thumbs-up and -down features, skip tracks and change stations -- and they do so about seven times an hour, which translates into seven digital advertising opportunities, he said. In the car, without the visual benefit, Pandora has an average load of two-and-a-half to three ads per hour, up from two to two-and-a-half in 2012, and it expects the number of spots to increase during the year to three to three-and-a-half on average this year. About 20 percent of Pandora’s ad load is local, Paschel said. Pandora can compete with terrestrial radio with fewer ads per hour because it can leverage RPMs (revenue per 1,000 listener hours) that “easily rival” those of terrestrial radio “because we have other methodologies to monetize,” he said. Pandora is targeting what Paschel called the “hyper-local” market, where a few local ads could add up to an RPM that could rival broadcast rates, “if not higher,” he said. On future expansion, Paschel said, the company is looking at international opportunities and other forms of content to be viewed as “radio,” not just music radio. Pandora will look to enter the sports market if it can be accretive to shareholders “soon” and not “10 years down the line,” he said. Pandora was international before it invested in IP-blocking technology in 2007, he said. Company research indicates Pandora would be approaching a 1 billion user database, he said, if it hadn’t started blocking IP addresses from outside of the U.S. Progress in its only international markets -- Australia and New Zealand -- has been strong, he said, but rights costs are an issue with additional international expansion. He cited recently published reports on Canadian sound recording royalty rates that are a tenth of the U.S. rates for that portion of the rights picture, but remaining Canadian royalty fees will determine whether Pandora will ultimately enter that market, he said.