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Ad Revenue From Mobile for Pandora Increases

Pandora Media, the company behind the popular Internet radio service about to face major competition from Apple, reported on Thursday a loss of $7.8 million, or about 4 cents a share, for the second quarter but the company continues to experience rapid growth.

Pandora said it had $157.4 million in revenue for the quarter ending in July, up 55 percent from the same period a year ago.

The ad revenue Pandora collects from mobile devices, where the majority of its 71.2 million active users do their listening, has also shot up quickly. It made $116 million from these ads in the quarter, up 92 percent from a year ago. At that time the company was charging $22.17 for every 1,000 ads served to devices like phones and tablets, but last quarter that rose to a high of $33.90.

“Ninety-two percent growth on mobile growth to $116 million is pretty much crushing it,” Joseph J. Kennedy, the company’s chief, said in an interview after Pandora announced its earnings.

Pandora also reported a success in another closely watched figure: its “content acquisition” costs, which include royalties to music companies. For the quarter, it paid $81.9 million, or 52 percent of its revenue, on these costs, its lowest ratio in almost two years.

Since bottoming out in November, the company’s stock price has increased more than 200 percent, and some analysts have recently given Pandora optimistic reviews. But the imminent arrival of Apple’s own radio feature and Pandora’s growing expenses continue to worry investors.

Pandora’s stock closed at $21.71 on Thursday, up 1 percent for the day, but it fell more than 6 percent in after-hours trading.

In a conference call with journalists and investors, Pandora announced that it had recently spent $8 million on “a broad patent portfolio” from Yahoo.

Pandora also announced a policy change that may encourage more use of the service. On Sept. 1, it will drop the 40-hour monthly limit for free listening on mobile devices, which it instituted in March as part of an effort to reduce royalty expenses.

CBS Trumpets Deal With FiOS TV in Jab at Time Warner Cable

CBS announced on Thursday morning that it had completed a new retransmission deal with Verizon’s FiOS TV service, pointedly connecting the resolution to its dispute with Time Warner Cable.

Leslie Moonves, the CBS president, underscored the contrast in the negotiations in a memo he sent to CBS employees noting that the deal with FiOS was “reached swiftly and amicably in just a few days.” The battle with Time Warner Cable began Aug. 2 with no end in sight. CBS programs are blacked out in more than three million homes.

Coincidentally, the coverage areas for Time Warner Cable and FiOS overlap in this case. The major areas of FiOS covered under the new agreement are in the metropolitan regions of New York, Los Angeles and Dallas.

In his memo, Mr. Moonves made a point of emphasizing that this deal included only what are known as over-the-air rights â€" that is, permission to retransmit the signals of CBS stations in those areas. That means all of CBS’s programming would be available.

What it does not cover are digital rights to CBS programs, which are now at the heart of the stalled negotiations with Time Warner Cable. CBS wants to retain those rights, which include the ability to sell libraries of CBS programming to digital outlets like Netflix and Amazon. The cable company wants to gain access to those rights in any fee increase it pays CBS for retransmission rights.

FiOS actually has slightly more subscribers in the covered areas than Time Warner Cable, about 3.5 million compared with 3.2 million. One difference with the FiOS negotiation is that it did not include CBS’s sister premium cable channel, Showtime.

No financial terms were disclosed, though a CBS executive aware of the terms said that the deal included a substantial increase for CBS. In his memo, Mr. Moonves said CBS achieved “fair value.”

The negotiations with FiOS were conducted quietly and early â€" the previous deal was not set to conclude until the end of the year.

FiOS could play another role in the dispute with Time Warner Cable, besides being a flag that CBS will wave to underscore its ability to make agreements with other distributors. FiOS is generally available as an alternative to subscribers affected by the blackout of CBS stations on Time Warner Cable.