Tuesday, July 9, 2013

Pandora's Box

I've been reading up on the unfolding saga of Pandora's fight to decrease royalty payments to artists. Pandora is currently in the process of lobbying congress to lower their already absurdly low royalty rates by 85%. The singer David Lowery recently wrote in a blog post about being paid $16.89 for over 1 million plays on Pandora of the hit song "Low".

He was also interviewed on NPR's Studio 360.

Many other artists, including Pink Floyd have been speaking out about this issue, and also about Pandora's attempt to get artists behind them by writing "letters of support" for internet radio.

Pandora's founder Tim Westergen claims that the 85% royalty cut is "misinformation", but doesn't really address what they're hoping to achieve in their negotiations with Congress.

Internet radio streaming services like Pandora and Spotify offer an incredible experience for listeners, but the fact is that they make no sense as business models. Both of them lose money every year and they'd prefer to find ways to pay artists less rather than improving their business models. At least Spotify has a subscription plan! It will be interesting to see what becomes of these companies in the near future.

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