New subscribers to Pandora’s (P) ad-free music streaming service, Pandora One, will have to dig a little deeper into their pockets to listen to the premium service.
Beginning in May, new subscribers to Pandora One will have to pay $4.99 a month, $1 higher than existing monthly subscribers, who will not see any change to their monthly charge. The option to pay an annual $36 fee to subscribe to Pandora One is also being eliminated. All Pandora One subscription fees will now be charged on a monthly basis only.
Current Pandora One subscribers who are paying the annual fee will be moved to the $3.99 per month charge when their current annual subscription expires. Pandora One annual subscribers will be notified before the subscription fee change is implemented. The move is expected to affect 3.3 million Pandora One users.
Pandora attributed the subscription fee price hike to rising music royalties fees, which the company says have soared 53% over the past five years.
Pandora stock rose more than 1% in Wednesday pre-market trading. P stock has gained more than 150% over the past 12 months.