They have an incredibly efficient negative cancelation program that hikes the teaser rate to something like $45/mo.
We did not try to cheat with bitrate but I am confident that only 1/100000 users would actually notice any difference between 128kbit/s and anything higher.
Even going lower than 128, you would be surprised how low you need to go before it really becomes noticeable to end users.
I have Pandora Plus $5/month.