Poor Pandora, and we loved you so.  (And by "we" I mean "they", as I wasn't a user.)  Regardless, I wonder if there's an inevitable cycle at play:

1) Business tries to do it legit
2) Business goes bankrupt due to impossible pricing
3) Pirate does it the easy way
4) Pirate gets sued to oblivion
5) Pirate does it the hard way.
6) ... it's free for the rest of eternity

If so, when it comes to web radio, it seems we're passing stage 2.  Next up should be a round of central pirate stations -- essentially large-scale shoutcast installations -- which briefly flourish followed by being wiped out.  The third wave should come in a couple years -- maybe some sort of centralized preference engine tied to decentralized streaming straight from trackerless torrents?  Sounds like a fun project!

- david barrett