The End of the Free Ride

The roll-your-own music service Pandora has announced that it is discontinuing its free unlimited mobile listening plan. In the company blog, Pandora founder Tim Westergren wrote, “This week we will begin communicating directly with a small number of our listeners as we introduce a 40-hour-per-month limit on free mobile listening. Most of you reading this will never hit the limit. In fact, it will affect less than 4% of our total monthly active listeners.”

Westergren goes on to explain why Pandora has done this “very unusual thing”: “Pandora’s per-track royalty rates have increased more than 25% over the last three years. After a close look at our overall listening, a 40-hour-per-month mobile listening limit allows us to manage these escalating costs with minimal listener disruption.”