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Artists Fighting Back Against Pandora

10-3-2012

Following carefully crafted e-mail messages from Pandora founder Tim Westergren (pictured), asking Pandora listeners to support The Internet Radio Fairness Act before Congress that would lower the fees Pandora pays to play music, artists are now fighting back. The musicFIRST coalition is using social media to urge consumers to "write Congress now and tell them to say no to slashing music creators' pay." musicFIRST is telling consumers Pandora is "dishonest" and the proposal before Congress would be "devastating to music creators."

musicFIRST posted the following message on Facebook. "While Pandora’s misleading campaign claims that Pandora is suffering under the current, fair system of compensation, nothing could be further from the truth. Pandora is expected to clear $600 million in revenues next year under the current system, and has seen year-to-year revenue growth that would be the envy of many businesses and families in this time of slow economic growth."

With the elections taking up the majority of everyone's time in Washington, it's unlikely anything will happen with the bill in 2012. Representative Jason Chaffetz told Radio Ink he believes he has enough support in Congress to get his bill passed. He also said "artists are thrilled with my bill." A statement musicFIRST Executive Director Ted Kalo said wasn't true and, in fact, that it "would be a step backward." The bill is supported by the National Association of Broadcasters.




(10/4/2012 12:18:46 PM)
I realize that Pandora has been profitable, and I don't have a problem with that. The reality, though, is that these fees drive new-comers out of the market and prevent competition to Pandora that could push down Pandora's subscription rates. The frustration, on the other end, is that the management companies pass only a small portion of their collections down to the artists to begin with. In my opinion, this fight is driven by the industry powers that rake in profits by charging high manditory fees vs. industry newcomers trying to create a viable business plan in an emerging distribution format. If ASCAP could charge broadcast radio per listener, they jolly well would -- and they'd drive stations out of radio like they have driven most broadcasters off the web. Of course I believe artists should be fairly paid, but I don't think webcast radio is the culprit when that does not happen. ...

- Stacey
(10/4/2012 10:38:42 AM)
This article could use some context and analysis. For example, Pandora is a broadcaster just like Sirius and Clear Channel. The rates paid by Clear Channel for terrestrial broadcast of music is $0. For Sirius/XM it is a percentage of revenue for the music stations. For Pandora it is a per play fee.

What would help provide the context is the amount Sirius paid to SoundExchange last year and how much Pandora paid. Then look at those payments as a percentage of revenue of the two.

- Paul Kamp
(10/4/2012 9:40:33 AM)
How much did the music industry pay for this blurb. It's misleading in so many ways and on so many levels. First, its not the artists fighting back - its the labels. Artists weren't even mentioned in the piece and its doubtful they would agree as a group with the label's position.

Second - letting the label's contention that the current system is working for Pandora go without mentioning that Pandora's position is that they have never made a dime BECAUSE of those royalties - is well, biased.

- Scoogie Bambone

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