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Pandora may pull the plug on itself

PandoraThe Washington Post is reporting that Pandora, the Internet radio station available on Mac, iPhone, and iPod touch, may be shutting down service soon.

The reason is that Sound Exchange, the money-grubbing blackmailers royalties collection arm affiliated with the Recording Industry Association of America, has imposed restrictive administrative fees ($500 per year per channel) and ridiculous royalty fees (2.91 cents per hour per listener) on Internet radio stations. While many companies that provide Internet radio services have been lobbying Congress for relief, there doesn't seem to be much of hope that happening in the near future.

What this means for all Internet radio stations is that either Congress steps in and attempts to resolve the royalty issues (not likely, considering their record on resolving any issue...), or the stations will need to start charging a subscription fee for their services. Of course, Pandora could start advertising on their site and on the iPhone app to generate some revenues, but as TechCrunch.com's Michael Arrington says, "Perhaps Pandora must be our sacrificial lamb" to focus attention on the entire issue of the recording industry, digital rights, and internet radio stations.

What's your opinion on the intenet radio royalty issue? Leave us a comment.

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