While it's clear iTunes Radio, which was released Wednesday, poses a risk to music streaming pioneer Pandora, stock analysts told CNBC they believe there's room for both in the market.
"Three to four big companies will own this space," said Rich Tullo, director of research at Albert Fried. "One is going to be Apple, one is going to be Pandora, one is going to be Spotify or whoever buys it and that's about it."
By his calculations, the streaming music business is currently worth roughly $25 billion. Pandora enjoys a 70 percent market share, too, said Lazard Capital Markets' Barton Crockett. It also boasts approximately 70 million active users, who play roughly 20 hours of music per month on average, according to Triton Digital.
The Internet radio company has an established presence in the United States, Australia and New Zealand, but has plans for further international expansion.
(Read more: Is Apple's iRadio a Pandora killer?)