Pandora Has Saved Internet Radio (For Now)

The future of online radio has been unclear for quite some time, thanks to the greedy music industry, but it looks as though Pandora has saved the day… not only for themselves, but for Internet radio as a whole. In a new agreement, Pandora is giving up 25% (at least) of their revenue, but it does mean security until at least 2015. That gives Pandora and other online radio stations a fair amount of time to work a more reasonable deal, or for the clueless beings overseeing the entire process a clue or two.

The key part in all of this is that SoundExchange agreed to a 40-50% reduction in the per-song (per listener) rates, and in return, Pandora gives up some of its revenue as mentioned above. But that’s not all. Listeners of the free service are going to be affected, but only those who use the service for more than 40 hours per month. If you happen to be one of those, you’ll have to pay $1 for unlimited access (that seems more than fair).

If you already happen to be a paid member of Pandora, then you’re going to see absolutely no change. Overall this is a huge win for Pandora and Internet radio as a whole, but it’s really too bad that these companies have to bend over backwards to cater to the music industry. It’s in no way like this with typical radio, so it’s strange that online radio gets the industry’s panties in a bunch. Either way, this is a great outcome, and we can all relax for the next while.

Oh, and if Pandora could finally come to Canada, that’d be great, too.

But Pandora also had to give up a little more. Because the rates agreed upon are still quite a bit higher than other forms of radio, the service is going to have to put limits in place for users of its free version. Apparently, this will only affect 10% of the user base, as it’s basically just anyone who uses Pandora over 40 hours per month. If a user hits that wall, it will only cost them $0.99 to go unlimited for the remainder of the month. Seems fair.