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Internet Radio Gets a Break, Pandora Adds $0.99 Fee

Posted 07/08/09 at 01:16:04 PM  by Paul Lilly

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With the threat of streaming rates for Internet radio rising to levels far above what many services could afford to pay, the future of Pandora and other Internet radio outlets remained very much in limbo. That's no longer the case, at least for Pandora, which reached an agreement everyone involved appears to be happy with.

"Pandora is finally on safe ground with a long-term agreement for survivable royalty rates," said Pandora CTO Tom Conrad.

For Pandora, the resolution means a 40-50 percent reduction in the per-song-per-listener rates. In exchange, Pandora will give up either a 25 percent share of its U.S. revenue, or the per-song-per-listener number, whichever is higher.

For Pandora's user base, the resolution means that anyone who uses the service over 40 hours per month will have to cough up $0.99 for unlimited access. The nominal fee is to help offset the royalty agreement, and is expected to only affect 10 percent of Pandora's users.

Despite the 25 percent royalty rate, Conrad remains optimistic that Pandora will reach its stated goal to be profitable by next year.

COMMENTS:7
TAGS: Software, music, Internet radio, Pandora
COMMENTS
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Submitted by bose2009 on Tue, 07/14/2009 - 5:20pm

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avatarDoes this mean it'll be

Submitted by Jox on Wed, 07/08/2009 - 2:35pm

Does this mean it'll be available in Canada again?

Stingy Americans don't want to share with us anymore =(

-Jox

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avatarGuys, .99 is freaking

Submitted by atomaweapon on Wed, 07/08/2009 - 12:57pm

Guys, .99 is freaking peanuts. I mean literally, I just spent .99 cents taking a breathe of air. I laughed and thought how ridiculous that is for unlimited listening. Even the 36 bucks a year is freaking nothing.

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avatarIf they carried the features

Submitted by ogremustcrush on Wed, 07/08/2009 - 11:58am

If they carried the features over to the Palm Pre client, I'ld probably buy Pandora One. I use it rarely enough on a desktop that the mobile support is key though.

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avatarRoyalties

Submitted by Hutif on Wed, 07/08/2009 - 11:25am

They need to pay royalties in order to legally stream the music.  I, unfortunately will be affected by this.  I'll probably upgrade to Pandora One at some point...

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avatarWhat exactly happened? What

Submitted by D3lt4 on Wed, 07/08/2009 - 10:44am

What exactly happened? What I mean is, who is pandora paying and why are their fees so high?

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avatarHigh fees?

Submitted by tkid124 on Thu, 07/09/2009 - 6:07am

I use pandora when i'm sitting at a workstation and don't have my iPod. But 99¢ is less than 12 bucks a year, and for that you are listening to more than 480 house of music, that is about 5% of a year if my head math is rigth. So 12 bucks (less than) for 5% of a year, nice!!!

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