Pandora employed this strategy to cap desktop listening to 40 hours per month several years ago, but it lifted the cap in September 2011. Starting Friday, mobile listeners who surpass the monthly 40-hour limit can either switch to desktop and laptop listening, pay 99 cents to continue ad-supported unlimited listening for the rest of the calendar month, or subscribe to Pandora One for ad-free unlimited listening.
Pandora says it expects the cap will affect “less than 4% of our total monthly active listeners.” It says the average listener listens to approximately 20 hours of music on Pandora across all devices–including mobile, desktop, laptop, and tablet–in any given month.
Pandora CEO Joe Kennedy explains the cap is part of the company’s effort to keep up with rising royalty rates, which he says have increased 25 percent over the past three years. He adds those rates are scheduled to increase another 16 percent in the next two years.
“What we’re trying to do is manage those royalty costs with a minimum amount of listener disruption,” Kennedy tells Mashable.