Herring notes that Pandora has better and more "surgical" tools to use like skip limits, in order to keep costs down. He called the cap a "blunt tool" and said that improvements in the business are allowing Pandora to monetize hours 41 and onward at a rate that allows the company to drop the cap. He said that when it put the cap back into effect in February, usage declined by 10%. What does the executive expect when the cap is lifted? "We don’t expect a big spike in hours. We do expect the hours to go up," he says.
While Herring didn't mention any competitors by name, he said that Pandora was no stranger to intense competition. Soon, Apple will launch iTunes radio and the lack of a cap on the advertiser supported service might have been one factor leading to Pandora's move.