Pandora Rolls Out Limit on Free Listening

Locally-based Internet radio site Pandora announced today that it's being forced to put a cap on the number of hours its users can stream free tunes from their individualized stations. Soon all that unlimited listening will be corralled into 40 free hours a month. Folks who want to spend more time on their pick of stations will need to pay for the privilege--a pretty reasonable $0.99 for the remainder of that month (an amount being touted as the "tip jar"). The minor charge is part of the company's agreement regarding a "long-term agreement for survivable royalty rates," as founder Tim Westergren detailed today on Pandora's blog.

His announcement showed a mix of relief--at resolving a two-year discussion on how royalty compensation would work with Pandora--and frustration that Congress has yet to legislate guidelines for radio (terrestrial, Internet, and otherwise) royalties across the board. Westergren writes of the larger issue at hand, "The system as it stands today remains fundamentally unfair both to Internet radio services like Pandora, which pay higher royalties than other forms of radio, and to musical artists, who receive no compensation at all when their music is played on AM/FM radio."