Last.fm will charge for its radio service in mobile apps and home entertainment systems beginning February 15, the company announced on Monday. Last.fm listeners will continue to get free, web-based listening in the U.S., U.K. and Germany. U.S. and U.K. users can continue to listen for free on Xbox Live and Windows Mobile 7 phones. Users can also continue to get free listening on the Last.fm desktop app.
A free, ad-supported radio service is "not practical," Last.fm Vice President Matthew Hawn explained in a post on the company's blog. Instead, the company will move to what it believes is the "highest quality, lowest cost ad-free music service in the world."
But any shift to paid model brings complications. If Last.fm loses customers, it will have a tougher time achieving the level of critical mass sought by streaming services. The monthly price may be equal to "a cup of fancy coffee," as Hawn put it, but paid Internet radio could be a tough sell. And judging from many of the blog post's comments, some customers are well aware of their alternatives.
With this move, Last.fm is running counter to the popular notion that Internet radio needs to be a free service. Mobile usage is a major factor behind Internet radio services' growth in recent years: Where would Pandora be without the iPod? And imagine how many Pandora users would have immediately lost interest if Pandora canceled its ad-supported option. On the other hand, an Internet radio service would need to charge something if it wanted to partner with mobile carriers and attract listeners with a carrier billing option.
The move echoes the premium charged for mobile use by on-demand services like Spotify and Rhapsody. PC-based listening can be free (at Spotify) or $5 a month (for Rhapsody). A PC-plus-mobile options costs more -- $10 a month is the standard in the U.S.