Pandora May Shut Down Due to Rising Royalty Fees

The Washington Post reports that the popular web radio service Pandora is close to shutting down entirely due to recent increases in royalty fees that affect web streaming services.

Pandora has become relevant in the Apple world since the release of their iPhone music application called Pandora Radio [App Store]. The free application allows users to tune into personalized streaming radio stations based on their favorite artists, songs, or classical composers. Pandora currently is the 7th most popular application on Apple's iTunes App Store.

According to the Washington Post, last year a federal panel ordered a doubling of per-song performance royalties that Web radio stations had to pay to performers and record companies. Pandora is a venture capital funded business which currently makes money through web-based advertising. In the near future, however, Pandora plans to introduce subtle in-stream ads to combat rising costs:

The company will soon start running subtler ads similar to those on National Public Radio, too, he said.

"Something like 'The next half hour is brought to you by . . .' " he said.

SaveNetRadio.org serves as an action site against the legislation.