Pandora is close to signing deals with the three major labels that would allow the company to expand its streaming service and offer a full on-demand tier, similar to what Spotify and Apple Music are offering, according to a report from the Wall Street Journal. That new service could launch as early as next month.
Pandora executives have for some time said that they wants to launch a paid on-demand streaming service to complement its existing service. To build out this new service tier, it acquired the assets and hired much of the staff of failed music streaming startup Rdio last year.
The company now plans to not only launch a $10 paid tier that will let users play individual songs and entire albums on demand, but also further build out its existing $5 subscription tier, dubbed Pandora One, which offers consumers ad-free listening to personalized radio streams. In the future, that $5 tier could include the ability to skip more songs, and download songs for offline listening, according to the Journal.
Pandora also plans to expand internationally, and could target English-speaking countries first, before eventually targeting other markets as well. Currently, Pandora is only available in the U.S., Australia and New Zealand, with most of its usage coming from U.S.-based users.
Pandora has had a bit of a rocky relationship with the music industry in the past. In the U.S., the music service has been relying on copyright clauses that allow it to play music without striking deals with rights holders, similar to the way music is being used by traditional radio stations.
Rights holders have long frowned upon that practice, and in fact battled with Pandora over royalty rates for some time. However, more recently, Pandora has been striking direct deals with publishers to get access to their repertoires without the need to rely on these co-called compulsory licenses, paving the way for direct deals with labels as well.