Non-paying mobile users of the service will be limited to 40 hours of free music each month, Pandora said, after which they can pay 99 cents to listen for the rest of the month or subscribe to a premium service.
Pandora eliminated a similar listening limit for desktop users in September 2011, also blaming increasing royalty licensing costs, CNET reported.
"Pandora's per-track royalty rates have increased more than 25 percent over the last three years, including 9 percent in 2013 alone and are scheduled to increase an additional 16 percent over the next two years," Pandora founder Tim Westergren wrote in a company blog post.
The average user spends about 20 hours a month listening to the streaming service, he said.
"After a close look at our overall listening, a 40-hour-per-month mobile listening limit allows us to manage these escalating costs with minimal listener disruption," he posted.
Non-paying users will receive a warning when they near their limit, he said.