As more and more things move into the cloud, music is one of the places where that process has been the most difficult. Music labels have not been willing to budge on their high royalties and strict anti-piracy policies that actually don’t prevent piracy all that well, anyway. Pandora was one of the first companies that were able to sign deals with major music labels, which one of the reasons their streaming service has been the most popular. The service is also one of the very few free streaming options on mobile devices.
Up until today, Pandora users had been able to stream an unlimited amount of ad-supported music on their smartphones and tablets. The company announced on Wednesday, however, that beginning March 1st, mobile streaming will be limited to 40 hours a month. Should a user reach that limit, a $.99 fee will be required to keep listening. While 40 hours may seem like a lot, think of it like this. If you have an hour long, round trip commute everyday and listen to Pandora on that drive, then you will only have roughly 10 hours to spare, or 20 minutes a day.
Pandora CEO Joe Kennedy says the limit is due to increased royalty rates. “Our royalty rates have increased more than 25% over the last 3 years, including a 9% increase in 2013 versus 2012,” he told Mashable. “What we’re trying to do is manage those royalty costs with a minimum amount of listener disruption.”
This change will not effect desktop computer users, who will still be able to stream ad-supported music for an unlimited amount of time. Pandora One users will also be unaffected, as they already pay a monthly fee for ad-free content.
“We’re conscious that those royalty rates are scheduled to go up another 16% over the next couple of years. So we’re trying to be very balanced,” Kennedy went on to explain. “We want people to continue to listen to and enjoy Pandora. We hate to bring any limit to that listening, but think that this is really a balance that we need to maintain”
Pandora says it expects only a small part of its userbase to be effected by this change, as most heavy listeners primarily use a computer. The company use to enforce this same cap on desktop users, but later removed because the monetization process became more mature. Pandora’s CEO says they may lift the mobile ban as mobile monetization matures.
“We don’t know exactly what the time frame will be. We believe that monetization on mobile will eventually get into the same range as the desktop, and I think we continue to make good progress in terms of our mobile monetization efforts,” Kennedy said.
Are you a heavy Pandora listener? Will you be hurt by this change? Let us know down in the comments!