Stabilizing gas prices, return to normal production levels to precipitate change: The value of fuel-efficient vehicles is expected to drop 15% by the end of 2011, according to a report from Kelley Blue Book. The steep hike in gas prices led to increased demand for subcompact cars and hybrid vehicles. The supply of those vehicles was disrupted by the devastating tsunami and earthquake in Japan. The value of fuel-efficient cars fell by 40% at the end of 2008 because of a plunge in fuel prices and economic uncertainty. But Kelley notes the correction this time shouldn’t be as severe.
Radio giant gets in music-streaming business: Radio station giant Clear Channel Communications Inc. is taking a swipe at online music service Pandora with a revamp of its iHeartRadio application, which imitates Pandora’s personalized listening experience but doesn’t mimic the startup’s need to turn a profit. Bob Pittman, chairman of media and entertainment platforms for Clear Channel Communications Inc., says the success of Pandora proves that people like being able to stream songs according to their personal tastes on mobile devices. Pittman says iHeartRadio will adopt that feature in a gradual relaunch over the coming months. Pandora went public with an initial offering of shares last month, but its stock price has seesawed as euphoria among Internet investors gave way to the reality that its ad revenue has not grown fast enough to cover the royalties that it pays to play music. Pandora’s stock closed at $19.27 on Friday, about 19% above its initial public offering price. Pittman said Clear Channel, a privately held company that had $5.9 billion in revenue last year, doesn’t need to turn a profit if its new service helps reach audiences in different ways. The iHeartRadio feature allows listeners to hear the feeds of stations outside their market and to access certain channels that stream music along specific genres. Clear Channel acquired streaming music company Thumbplay in March and used its technology as the basis for the new customized radio feature.
