In a move that will affect less than 4% of its users, Pandora announced yesterday that it will begin limiting listening on mobile devices to 40 hours a month. As they approach that limit, the listener will hear from Pandora, and be offered a couple of options. They can choose to pay 99 cents for unlimited use of the service for the rest of the month, or they can sign up for Pandora One for $3.99 a month, which gives them unlimited, commercial free listening to the service.

In a blog post yesterday, Pandora founder Tim Westergren explained that “ this is an effort to balance the reality of increasing royalty costs with our desire to maximize access to free listening on Pandora.”

In addition to helping cover royalty and other expenses, this will get the attention of the heaviest users of Pandora. I’m sure Tim would like to mobilize those listeners to help persuade their congressional representatives to pass the Internet Radio Fairness Act. As he points out in his post, “Pandora’s per-track royalty rates have increased more than 25% over the last 3 years, including 9% in 2013 alone and are scheduled to increase an additional 16% over the next two years.”

It’s a strategy that could work well for Pandora, as they could win in one of two ways, either by inspiring their most dedicated listener base to join them in lobbying Congress, or by converting a portion of those listeners to paying subscribers. It’s also a move that may please investors, who have been concerned about Pandora’s ability to monetize mobile impressions.

All in all, this is sounding like a pretty good strategic move..

If venture funding is a measure of the success of online music then things are going well, according to a recent article which claims that music industry ventures raised $621 million in 2012. The article also points out that funding to music ventures is up 34% while funding across all sectors has dropped 10%. You may want to take some of this with a grain of salt however, an article in Billboard a few weeks ago points out that some of the companies counted in that big number are actually not music services at all.

Nonetheless, there were a number of services that got big dollars last year, including Spotify, Deezer, TuneIn, SoundCloud, Senzari, Soundrop, exfm, Songza, Jelli and The EchoNest, all services that are directly related to the streaming marketplace. According to my tally, streaming related services took $328 million in funding last year, with Deezer and Spotify leading the charge.

DMW’s chart

Aritaur Communications has announced that it will sell the frequency for WMVY, its Martha’s Vineyard fm station, to WBUR, Boston’s NPR news station. Their plans for the signal do not include continuing to air the local flavored, eclectic-folk-alternative format that generations of islanders (either physically or virtually) have come to love. The staff of the station, headed by highly talented program director and all around great gal Barbara Dacey, are hoping that the community (local and online) will rally and raise enough cash to keep the programming streaming online. 

I met Internet radio for the first time while I was managing Aritaur’s group of radio stations, and spending a lot of time at WMVY. It is, without a doubt, the best radio station, bar none, in the world. On any given day, at the little house at the end of a dirt road that we called an office, any number of fun, folksy, or famous people might stop by to visit. It is one of the few broadcast stations left that doesn’t program for mass appeal, which of course is its magic.

Dacey and others at the station are hoping to raise $600,000 in sixty days to keep the format alive online, which would be a fine place for it to live. While this may seem like a daunting goal, take this little story as an example of the power that a community has to save things that it values. I live in a small village in Connecticut where last year after hurricane Irene, our local market went out of business. For four months our community mourned the loss of our local store, before deciding to form a co-op to replace it. In a few short months the store had over 600 members (at $195 a membership) and had also loaned the store over $300,000 (in more than 200 individual loans). The store is open for business, and doing pretty well, in a village that is a lot smaller than Martha’s Vineyard.

So here’s wishing my friend Barbara and her crew a lot of luck in this next chapter. I’m sorry that WMVY won’t be on the air the next time I head out to the cape, and I know that Aritaur’s founder Joe Gallagher will miss it too; owning that station was his dream come true, selling it can’t have come easy.

In the meantime, you can still listen to the best there is, right here…

I’m electronically challenged this week due to Sandy. While the first couple of days weren’t so bad, we’re now into day four and the outage is losing its charm. It’s really hard to keep up with news when you don’t have Internet or television. Unfortunately, the local radio programming in our part of the world is completely inadequate. Most stations have few or no news reporters. So there’s a ton of local news and a real dearth of local news reporting. Texts have become my primary way of staying connected. School cancellations come by text as well. 

I have to admit, this has given me pause to think about the value of an fm chip in phones. Even though I can listen to a stream right now, my battery charge is a little too precious for that. Would I listen to broadcast radio on my phone during this outage? I might, especially if I could get decent local news by live reporters who would tell me what the power outage situation is, update me on what is going on in town, what roads are flooded, and where I can get an Internet connection. Some of my neighbors are looking for even more basic information like showers and water.

Unfortunately, a lot of local radio stations have peeled back their staffs to such a point that the only “local” programming they offer is top-of-the-hour headline news, and some ads. That’s not the kind of thing that is going to make people listen on their smartphones, even if they could..