Pandora to Limit Free Listening, Citing Royalty Costs

Faced with rising royalty costs, Pandora will limit the amount of free music that its users will have access to on mobile devices.

Tim Westergren, the founder and public face of Pandora, said that a limit of 40 hours a month on mobile devices would take effect this week for its free service. The change, he said, would affect less than 4 percent of its more than 65 million regular customers, since its average listener spends about 20 hours a month on the service. To continue listening, Pandora’s mobile users can upgrade to its $36-a-year paid version or switch to listening via computer. A spokeswoman for the company said the move was most likely temporary, but that it had no plans for lifting the limit. The reason Westergren gave was the rising cost of its music licenses. Its per-song royalty rates have increased 25 percent over the last three years, he said, and are to go up 16 percent over the next two years.