If I am not mistaken, over the air radio does not have to pay royalties.

Mostly correct. Radio, satellite, and internet all pay different kinds of royalties at different levels (or used to, last I checked). I believe radio only pays the songwriters/publishers, whereas [streamer] might’ve also paid the performers.

This is also different than how individual companies - say Spotify - pay for content via direct deals.

I’m also confused because Pandora is ad-supported and generated ~1B per year, but the numbers here are low. But that may be captured in some other metric.