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Pandora Stabilizes, No Longer Completely Free 268

Posted by Soulskill
from the under-a-buck dept.
AbyssWyrm writes "Yesterday, Pandora founder Tim Westergren announced that the music service was on safe ground once again, but will no longer be free for all users. Instead, it will be really cheap — for those with a free account, there will be a cap of 40 hours per month, and a user may pay a one-time fee of $0.99 to resume unlimited listening to music for a month. According to the blog entry, this will affect the top 10% of listeners. Certainly not a bad deal considering the price, and I suspect that Pandora is one of few free internet resources whose users are loyal enough to pay a small fee to keep it afloat. Pandora's future had been uncertain ever since the royalty rates for internet radio were increased in 2007."
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Pandora Stabilizes, No Longer Completely Free

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  • Now that they have payment model instructed too, why not expand it outside US aswell? Last.FM radio has something similar too, they had to start charging non-US/CA/UK users because there wasn't enough advertisers in other countries to make it profitable. That being said, we have that awesome Spotify [spotify.com] here, but I'm sure there would be lots of old non-US Pandora users that would pay a little to listen to it again.

    • Re:non-us? (Score:5, Informative)

      by DragonWriter (970822) on Wednesday July 08, 2009 @09:48AM (#28622275)

      Now that they have payment model instructed too, why not expand it outside US aswell?

      Probably because the scope of the agreement with copyright owners doesn't extend to use beyond the US; my understanding from what I've read about it is that it specifies a licensing fee that includes a portion of US revenues in exchange for allowing internet streaming of the music in the US.

  • I guess (Score:5, Insightful)

    by gubers33 (1302099) on Wednesday July 08, 2009 @09:33AM (#28621999)
    I guess a one time fee of $0.99 isn't too much to ask. I do have over that with the change in my pocket from my two coffees I go this morning.
    • Re: (Score:2, Informative)

      by Aphonia (1315785)
      its 0.99 / month, not a one time fee. Still, id pay it.
      • Re: (Score:3, Informative)

        by StellarFury (1058280)

        It's more complicated than that though.

        It's a one-time fee if you go over 40 hours in a month, and then you get unlimited listening for that month. You have to pay again if you go over 40 hours of listening in the next month. But if you stay under 40 hours, it's free.

    • by uncledrax (112438)
      Per month btw, at least according to the summary. That's still inexpensive enough I might come back to Pandora and chip in.
    • Re: (Score:2, Interesting)

      by Anivair (921745)
      the reason people on the net generally refuse to pay 0.99 for things (like porn sites) is not thrift, but fear. Usually, it's a scam. Pandora is not a scam, so I'll gladly pay.
  • I wish... (Score:3, Interesting)

    by danking (1201931) on Wednesday July 08, 2009 @09:39AM (#28622111)
    Pandora was available in Canada.
    • by Itninja (937614)
      It's a website. Are you saying that it's being filtered out in Canada?
      • Re:I wish... (Score:4, Informative)

        by Canazza (1428553) on Wednesday July 08, 2009 @10:07AM (#28622589)

        Dear Pandora Visitor,

        We are deeply, deeply sorry to say that due to licensing constraints, we can no longer allow access to Pandora for listeners located outside of the U.S. We will continue to work diligently to realize the vision of a truly global Pandora, but for the time being we are required to restrict its use. We are very sad to have to do this, but there is no other alternative.

        We believe that you are in United Kingdom (your IP address appears to be **.**.**.**). If you believe we have made a mistake, we apologize and ask that you please contact us at pandora-support@pandora.com

        Yes... he is

  • If you pay, are you still forced to listen to music you don't like?

    One of the reasons I never used Pandora was that unless I made a new playlist, I couldn't skip songs after a little while.
    • Re: (Score:3, Interesting)

      by RingDev (879105)

      Not sure about that. I can't listen at work anymore, but I used to have Pandora on all day. You could skip something like 3 songs in a 15 minute period or 6 songs an hour. And with the rating system you could filter out bad music rather easily. And if you ever just got tired of a song there is the "ZZZ" button to remove the song from your play list for 30 days.

      Pandora had it's issues. Like I hate listening to live recordings, which I know is one of the tags that they mark songs with. But I couldn't just set

    • by COMON$ (806135)
      Easy fix, be less picky or create a better station. I haven't had to skip a song in months (outside giving an occasional one a thumbs down). Pandora has to pay for the song whether or not you listen to the whole thing.
  • Have you read this? (Score:5, Interesting)

    by 2obvious4u (871996) on Wednesday July 08, 2009 @09:41AM (#28622145)
    Piracy Tips for Consumers [riaa.com], I was reading the "royalty rates" link and saw that the RIAA was behind it, so I went to their website and found this jewel.
    Of note: Watch for Compilations that are "Too Good to Be True". Why are they too good to be true? If customers would want that compilation why haven't you sold it to them?
    Even better: Trust your ear: The sound quality of pirate CDs is often poor or inconsistent. It is a freaking digital copy, it is the exact same quality! Does anyone actually believe this stuff?
    • Re: (Score:3, Interesting)

      by 2obvious4u (871996)
      I know I shouldn’t be replying to myself, but I’m still reading the RIAA website and I found another jewel:
      Even if you don’t illegally offer recordings to others, you join a file-sharing network and download unauthorized copies of all the copyrighted music you want for free from the computers of other network members.
      If I own the CD's, but don't have software to burn them, don't I have the right to download the songs off a P2P network? I purchased the right to have a backup copy, does i
      • by Alsee (515537) on Wednesday July 08, 2009 @10:07AM (#28622595) Homepage

        There's an even worse one in there. How about:

        Furthermore, if the record label listed is a company you've never heard of, that should be another warning sign.

        That sounds to me like it's bordering on an anti-trust violation, smearing the smaller non-RIAA music labels as illegitimate and illegal. I haven't bought any RIAA CDs in years because they've been acting like dickwads, but even before they started acting like dickwads most of the CDs I bought *were* from record labels I'd never heard of. I did buy some "top 40 pop" stuff, but for the most part the RIAA labels just didn't carry what I wanted, and the "unheard of" indie labels did.

        -

      • by selven (1556643)
        I like the one about "dream compilation" CDs. It's like they're acknowledging that they're making you buy 19 crap songs with each good one in an album.
        • Re: (Score:3, Insightful)

          by selven (1556643)
          Sorry about replying to myself, but I just found another gem:

          Music pirates aren't in the music business, they are in the plastics business. They buy and sell plastic and get consumers to pay them 10 to 20 times their cost for a blank disc by simply loading that plastic up with stolen music.

          That argument applies almost verbatim to the music industry itself.
    • I really have to stop reading this [riaa.com] it is making me sick.

      Here is something even non-pirates have done at least once in there life:
      You have a computer with a CD burner, which you use to burn copies of music you have downloaded onto writable CDs for all of your friends.

      So you mean that since the days of cassette tapes every person who has made their girlfriend/boyfriend a mix tape or mix CD is in violation of the law? It must be true, the RIAA says so.
      • So you mean that since the days of cassette tapes every person who has made their girlfriend/boyfriend a mix tape or mix CD is in violation of the law? It must be true, the RIAA says so.

        Well, actually, yeah.

    • by radish (98371) on Wednesday July 08, 2009 @10:16AM (#28622773) Homepage

      Too Good To Be True == 200 tracks for $2. They didn't sell that because they don't want to give stuff away so cheaply. How is that hard to understand?

      It is a freaking digital copy, it is the exact same quality

      Maybe, maybe not. I've never heard a pirate CD, but I've seen plenty of pirate DVDs. Some are direct digital copies of the original and look great, plenty are just burned torrent downloads (and so have compression artifacts everywhere). Some are screen cams. I'm sure the same holds for audio.

      • Re: (Score:3, Interesting)

        by Draek (916851)

        Too Good To Be True == 200 tracks for $2. They didn't sell that because they don't want to give stuff away so cheaply. How is that hard to understand?

        Read the link, it says nothing about number of tracks or price, only about the diversity of the artists.

  • One time fee? (Score:5, Insightful)

    by Ambiguous Coward (205751) on Wednesday July 08, 2009 @09:44AM (#28622197) Homepage

    Not to be a terrible pedant, but if you pay a "one time fee" to get unlimited listening each month, it's not a one-time fee. It's a monthly fee. It just has a very low subscription cost.

    • Re:One time fee? (Score:5, Informative)

      by samkass (174571) on Wednesday July 08, 2009 @09:51AM (#28622319) Homepage Journal

      It's not a subscription, though, because you don't have to pay it every month. If you go over the limit in a month, the fee really is one time to get more Pandora that month. You won't be charged the next month unless you go over the limit again and want to listen again. I agree it's not a "lifetime" membership for a one-time fee, but it's not a subscription either. Maybe they should just drop the qualifier and call it a "$1 fee".

      • It's not a subscription, though, because you don't have to pay it every month.

        If you want to listen for more than 40 hours a month you sure as heck do. :)

      • by houghi (78078)

        I can imagine that there will be a "$10 annual fee" very soon.

  • by danking (1201931)
    A thought about this. I know that the rates charged by credit card companies to process a transaction tend to be very high. Does anyone know how the pricing structure works? How much of the final transaction will actually be paid to Pandora?
    • If you pay with a credit card, the transaction fee is usually 10-15 cents + 3% of the transaction, unless they have a deal with their processor so they don't get killed with all of their microtransactions.
    • by catxk (1086945)

      In Sweden, the charge is around $0.4 per transaction. I think.

  • The reason I never signed up to begin with was that I figured the music licensing cartel would drive them out of business before long. Now I'll go check it out.

  • by bcrowell (177657) on Wednesday July 08, 2009 @09:51AM (#28622307) Homepage
    This comes on the same day that an agreement was announced [nytimes.com] that lowers royalty payments for internet radio stations. The original plan called for royalties of 0.19 cents per streamed song. The new plan sets royalties for large stations at 25% of revenue or .14 cents/song (whichever is greater). Small stations will pay $25,000/yr or 12-14% of revenue (whichever is greater). It sounds like it's still going to be impossible for individuals to set up stations as a hobby, which I guess it was practical to do at one point, but I'm guessing that a lot of college radio stations might find it cheaper to pay the $25k/yr than to maintain an FM broadcast station.
    • Re: (Score:3, Interesting)

      by davek (18465)

      Unbelievable. The broadcasters "negotiated" to give away a minimum of 25% of their revenue for nothing in return, and they're falling over themselves thanking the extortionists for the privilege? This is insanity.

    • I'm sure there will be a way round this. make the radio station itself run on a shoestring budget, and have the profits made by a controlling organisation - since after all they pay a percentage of revenue, just ensure the revenue is tiny!

      surely it's about time the OSS movement learned how to do HollyWood Accounting [wapedia.mobi]
  • My friend got a e-mail from pandora saying she was in their top 10% of listeners.

    She said they "let [her] down easy" and gave her alternative "solutions" to deal with capped listening times.
  • Slacker? (Score:4, Interesting)

    by purplebear (229854) on Wednesday July 08, 2009 @09:56AM (#28622405)

    Do none of you use http://www.slacker.com/ [slacker.com]? I started with Pandora, but I find Slacker far superior. It is free with ads and has a paid subscription with no ads. The channels are more professionally programmed, so I don't get the odd song thrown in that just doesn't fit the chosen genre in the least.

    • Re:Slacker? (Score:4, Insightful)

      by Itninja (937614) on Wednesday July 08, 2009 @10:11AM (#28622685) Homepage
      Yes, but the whole point of Pandora is the 'music genome project' engine. I like being introduced to songs with similar attributes, not just of a similar genre or era. Seriously, I told Pandora I liked certain Jack Johnson songs and was introduced to artists that I would have never normally explored (i.e. heavy metal bands doing acoustic numbers or world music artists).
    • by ArhcAngel (247594)

      It's a matter of taste. I prefer Pandora to Slacker. Especially since Pandora's new Blackberry app doesn't choke my BB 8310 like the Slacker app did. Looking at both sites they both have adds but the Slacker site "feels" like it is trying to sell me stuff. Kinda like I just stepped onto a used car lot. There are things I like/dislike on both but I just like Pandora more.

    • It may be. But you are missing the whole point of Pandora. I, for one, have found it to be great service to explore music - to find hidden gems I would not have found otherwise - based on what kind of music I like, not somebody else.
  • by doas777 (1138627) on Wednesday July 08, 2009 @10:00AM (#28622469)
    My primary concern with low-cost services, is that of transactional security. I don't want to expose my CC to compromise over only 1$. Paypal is just as bad. if I subscribe to 100 1$ services per month, how much does that increase my exposure, vs one transaction for 100$? low cost webservices may be the answer to making money online, but I'm not here so a provider can make a buck.
  • by l00sr (266426) on Wednesday July 08, 2009 @10:01AM (#28622487)

    I know there must be a good, albeit esoteric explanation for this, but the economics behind this decision are baffling to me. One would think that if Pandora had a profitable business model, then profit and listeners' usage of their service should be positively correlated; i.e., the more I listen, the more profit Pandora makes from advertising. However, if they're encouraging people to use the service less, the obvious explanation would be that usage and profit are negatively correlated; i.e., Pandora would be hemorraging money.

    It's as if Sony were to suddenly decide to cap the number of PS3's you can buy to limit their losses...

    • My guess is that this doesn't fit well into the traditional supply/demand model because the service is nominally free. If the cost is zero, there is no reason for people to not demand infinite product. Since Pandora has some revenue coming in through ads, they can subsidize the not-actually-zero supply to meet the zero cost demand, up to a point; after that, they have to start charging to discourage infinite demand. This makes sense if most of their listeners only listen a short while, and a few listen c
    • Reminds me of the days when bandwidth was *really* expensive and Biz Dev Guys were cheap:

      Meetings with new site managers went something like this:

      "The Good News: Traffic is 500 times more than predicted; The Bad News: Traffic is 500 times more than predicted..."

    • by Temposs (787432)

      Well, I imagine the 40 hour cap approaches some limit in the advertising in which the advertisements become less effective, and the advertisers are not willing to pay the same rate. I'll bet the advertisers are willing to pay more to have an advertisement come on right when a user logs onto Pandora, but the longer you're logged in perhaps you're less likely to click on an ad or be affected by an ad, because you're just listening to music(or you left the room). So, Pandora probably calculated a threshold at

  • Top Listener Email (Score:3, Informative)

    by Mondo1287 (622491) on Wednesday July 08, 2009 @10:06AM (#28622583)
    Here's the email I received from Pandora: Hi, itâ(TM)s Tim - I hope this email finds you enjoying a great summer Pandora soundtrack. Iâ(TM)m writing with some important news. Please forgive the lengthy email; it requires some explaining. First, I want to let you know that weâ(TM)ve reached a resolution to the calamitous Internet radio royalty ruling of 2007. After more than two precarious years, we are finally on safe ground with a long-term agreement for survivable royalty rates â" thanks to the extraordinary efforts of our listeners who voiced an absolute avalanche of support for us on Capitol Hill. We are deeply thankful. While we did the best we could to lower the rates, we are going to have to make an adjustment that will affect about 10% of our users who are our heaviest listeners. Specifically, we are going to begin limiting listening to 40 hours per month on the web. Because we have to pay royalty fees per song and per listener, it makes very heavy listeners hard to support on advertising alone. Most listeners will never hit this cap, but it seems that you might. We hate the idea of capping anyone's usage, so we've been working to devise an alternative for listeners like you. We've come up with two solutions and we hope that one of them will work for you: Your first option is to continue listening just as you have been and, if and when you reach the 40 hour limit in a given month, to pay just $0.99 for unlimited listening for the rest of that month. This isn't a subscription. You can pay by credit card and your card will be charged for just that one month. You'll be able to keep listening as much as you'd like for the remainder of the month. We hope this is relatively painless and affordable - the same price as a single song download. Your second option is to upgrade to our premium version called Pandora One. Pandora One costs $36 per year. In addition to unlimited monthly listening and no advertising, Pandora One offers very high quality 192 Kbps streams, an elegant desktop application that eliminates the need for a browser, personalized skins for the Pandora player, and a number of other features: http://www.pandora.com/pandora_one [pandora.com]. If neither of these options works for you, I hope you'll keep listening to the free version - 40 hours each month will go a long way, especially if you're really careful about hitting pause when youâ(TM)re not listening. Weâ(TM)ll be sure to let you know if you start getting close to the limit, and weâ(TM)ve created a counter you can access to see how many hours youâ(TM)ve already used each month. Weâ(TM)ll be implementing this change starting this month (July), Iâ(TM)d welcome your feedback and suggestions. The combination of our usage patterns and the "per song per listener" royalty cost creates a financial reality that we can't ignore...but we very much want you to continue listening for years to come. Please don't hesitate to email me back with your thoughts. Sincerely, Tim Founder
  • Maybe I'm over-looking something here, but couldn't you just create additional free accounts? Yes, I'm that cheap...
    • by immakiku (777365)
      Probably, but that is still an additional hassle. I think most users would rather pay $1 than go through however many log-ins and log-outs.
  • Say what again (Score:3, Insightful)

    by jackspenn (682188) on Wednesday July 08, 2009 @10:12AM (#28622703)

    one-time fee of $0.99 to resume unlimited listening to music for a month

    How is it you pay a one time fee for a monthly service?

    Should it be:

    • A $0.99 fee per each month of music
      -- OR --
    • A one time fee of $0.99 for unlimited music
  • by Mordac (1009) on Wednesday July 08, 2009 @10:38AM (#28623141)

    As a top ten percent user, this is it, the final straw. I'll pay the whole $3 a month for premium service. I hope they're happy, they've converted me from a non-paying user to a paid subscriber.

    I hit the 40 hours probably the first week of every month, I require a soundtrack to be able to program, and Pandora works wonders for me.

  • Spotify (Score:3, Informative)

    by SlashBugs (1339813) on Wednesday July 08, 2009 @11:12AM (#28623689)
    For folks who can't access Pandora, have a look at Spotify [spotify.com]. It's a similar idea to Pandora, but gives you more control over which tracks you listen to. I don't like it's "artist radio" as much as I like Pandora's stations/channels, but building playlists more than makes up for it. It runs in a client rather than a browser; works perfectly for me on Mac (10.4) and Kubuntu 8.10 (running inside WINE).

    The one con relative to Pandora is that Spotify has audio ads; I've never counted but it's something like one 10 second ad every 10 songs. Not perfect, but much better than listening to a real radio station. On the upside, you can pay for a day or a month of ad-free listening.

    There's also Magnatune [magnatune.com] which is a good source of DRM-free independant music. Not great as a radio station, as the free streaming is very basic, but I've got some good music from them.
  • Not a bad deal... (Score:3, Insightful)

    by moxley (895517) on Wednesday July 08, 2009 @12:13PM (#28624745)

    When I first saw the headline, I thought "Oh shit - one of the few free music apps that works perfectly and actually has good content is now going to be ruined;" not because I have any objection to paying a fair price for things, but because historically with free music sites/services online, once money becomes involved they change, and usually not for the better.

    However, I find this pricing model pretty appropriate - if you are listening over 40 hours a month, 99 cents is a small price to pay to support the site. This doesn't look to me like a way to exploit their userbase for huge economic gains, rather, it looks like a site doing what they need to do to survive without taking advantage of their user base.

    If they raise it substantially, quickly - I might feel differently, but from what I understand they were having to deal with this seems like a pretty good way to go - managable and fair, and only affecting heavy users.

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