Thanks to lots of legwork by Pandora, internet radio startups overall might have a chance to survive. Already precipitously high and in danger of being raised even further, the royalties a music streaming site is required to pay per-song-per-listener have been set to workable levels. An agreement between SoundExchange, webcasters, artists and record labels reduces the royalty rate in exchange for a 25% revenue share or the new per-song royalty rates going into effect, whichever is higher. Ouch. Still, it's an improvement over the tense situation previous to this agreement and represents a reasonable expectation that labels are satisfied with the deal, meaning they'll be less prone to become lawsuit-happy over new startups sprouting up.

This has some minor consequences to Pandora's free service, where listeners will be capped at 40 hours a month. To continue streaming beyond that, it's only a $0.99 payment which seems quite reasonable if you're not ready or willing to pony up for the Pandora One subscription tier. Pandora CTO Tom Conrad said the rates are still "expensive," but "workable." He says the service should still be on track to reach profitability by next year.

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