On June 11, Pandora went in an unusual direction for a digital company: backwards.

That's when the online radio giant announced it was buying a terrestrial station, KXMZ-FM, which plays AC hits out of a small basement studio on Main Street in Rapid City, S.D. For the 42,000 Pandora users who live in the Rapid City area -- or at least, those of them that might start a personalized Pandora stream around Michael Buble or Maroon 5 -- that was great news. But for the music industry, it was a far less welcome development.

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