The Wall Street Journal reports that Grooveshark will launch a new service in January, called Broadcasts. Instead of offering on-demand songs, as Grooveshark's current service does, Broadcasts will have radio stations curated by users.
The service will cost $0.99 per month and will have no advertisements. Just as importantly, all of the songs will be fully-licensed, with royalties paid through the same government-mandated system used by Pandora and its ilk. By going the radio route, Grooveshark doesn't have to negotiate directly with record labels.
That's a necessity at this point, given that labels haven't taken too kindly to Grooveshark in the past. Unlike other on-demand services that licensed their music from the start, Grooveshark built its service through user uploads, then went back to labels to negotiate licensing. Instead, several labels sued, and in September, a judge found Grooveshark employees guilty of copyright infringement for personally uploading thousands of tracks. Even before the verdict came down, the legal battle reportedly left Grooveshark CEO Sam Tarantino penniless, and in the meantime, Spotify became the more popular service with free on-demand streaming on PCs and tablets.
Tarantino told the Journal that the on-demand service will push on with continued attempts at licensing, and the company will still sell $9 per month subscriptions that include access on Android (with side-loading) and jailbroken iOS devices. While the on-demand apps aren't welcome in Google Play or the iOS App Store due to copyright complaints, Broadcasts should have no such problems.
Why this matters: The new service will mark a fresh start for Grooveshark, and the human touch could very well help Broadcasts stand out from other Internet radio services. Still, it's unclear how Grooveshark will convince people to get on board with a paid service, even at the low price of a dollar per month. Having built its business on people's reluctance to pay for music, Grooveshark may be in for a rough transition.