Pandora Ending Unlimited Ad-Supported Mobile Streaming

Pandora’s music streaming service will ditch its unlimited ad-supported mobile platform and replace it with 40 hours of free play. The move comes in anticipation of royalty rate increases, which are scheduled to increase by 16 percent over the next several years.

The new 40 hour ad-supported ceiling will go into effect on March 1 and is expected to affect just four percent of Pandora’s users.

According to the company, the average Pandora listeners enjoy just 20 hours of free streaming music per month across a combination of mobile and desktop usage.

To offset the changes, Pandora will allow customers to make an in-app purchase that provides continued listening for $0.99 to finish out the month after 40 hours of usage has been reached.

The new policy change does not affect premium “Pandora One” users who pay for monthly mobile access.

Speaking to Mashable, Pandora CEO Joe Kennedy reveals:

“We’re conscious that those royalty rates are scheduled to go up another 16% over the next couple of years. So we’re trying to be very balanced. We want people to continue to listen to and enjoy Pandora. We hate to bring any limit to that listening, but think that this is really a balance that we need to maintain”

Kennedy further adds:

“We do see this as not a permanent change, but, and an appropriate and necessary balancing for this stage of development given the royalty cost that we bear.”

Pandora is sending out emails to users who are likely to be affected by the new policy change.

Are you surprised by Pandora’s sudden change in music streaming policy?