Pandora will soon start on-demand streaming

Pandora is moving ahead with its plan to compete with Spotify and Apple Music. The free, ad-funded internet radio service will launch on-demand streaming as soon as next month.

The company is close to securing deals with major record labels that will allow it to introduce on-demand streaming, according to the Wall Street Journal.

On-demand streaming represents a big change for Pandora, which has thrived for 16 years with its free service. Users can't choose specific songs to listen to, but instead choose themed radio stations that are interspersed with advertisements. For $5 a month, Pandora listeners can pay to avoid ads.

When reached for comment, a Pandora spokesperson passed along a statement: "We’re incredibly excited about what’s ahead. We’ve been working hard to bring an expanded listening experience to listeners and are on track to do so later this year."

The new services will include two new monthly subscription options, including a $10 a month option most similar to Spotify and Apple Music. The rollout also includes a plan to add more perks to the $5 a month option.

Pandora has been up for sale, and reportedly rejected an acquisition offer in July that valued that company at $3.4 billion.

Even as it rolls out these big changes, Pandora is still seeking a buyer.

Although it's not as successful as its subscription-based competitors, Pandora still pulls in about 80 million active monthly users. Plus, many people who have subscriptions to Spotify or another on-demand streaming service also use Pandora.

If Pandora can bring those listeners into its new subscription model, it'll be a success for the company. Pandora's stock was up 3.4 percent Friday after news of its on-demand streaming plans broke.