PINK FLOYD: PANDORA’S INTERNET RADIO ROYALTY RIPOFF

June 30, 2013 – 4:56 am


Internet radio companies are trying to trick artists into supporting their own pay cut. Open letter by Pink Floyd.

Great music can inspire deep emotions, and businesses have long sought to harness this power in order to make money. Nothing wrong with that - everyone deserves to make a living - but too often it leads to less than scrupulous behavior. The latest example is how Pandora is pushing for a special law in Congress to slash musicians’ royalties - and the tactics they are using to trick artists into supporting this unfair cut in pay.

It’s a matter of principle for us. We hope that many online and mobile music services can give fans and artists the music they want, when they want it, at price points that work. But those same services should fairly pay the artists and creators who make the music at the core of their businesses. For almost all working musicians, it’s also a question of economic survival. Nearly 90 per cent of the artists who get a check for digital play receive less than $5,000 a year. They cannot afford the 85 per cent pay cut Pandora asked Congress to impose on the music community.

Last year, we joined over 130 other bands and artists to oppose Pandora’s campaign to cut the royalties paid for digital radio spins. Widespread artist opposition stopped them last year, so this year Pandora is trying to enlist artists support for their next attempt at passing this unfair legislation.

Sounds good. Who wouldn’t want to be “part of a conversation”? Who doesn’t support Internet radio? What scrooge would refuse to sign such a positive, pro-music statement? Of course, this letter doesn’t say anything about an 85 per cent artist pay cut.

Musicians around the country are getting emails from Pandora - even directly from the company’s charismatic founder Tim Westergren - asking them to “be part of a conversation” about the music business and sign a simple “letter of support” for Internet radio.

Sounds good. Who wouldn’t want to be “part of a conversation”? Who doesn’t support Internet radio? What scrooge would refuse to sign such a positive, pro-music statement?

Of course, this letter doesn’t say anything about an 85 per cent artist pay cut. That would probably turn off most musicians who might consider signing on. All it says about royalties is “We are all fervent advocates for the fair treatment of artists.” And the only hint of Pandora’s real agenda is the innocent sounding line “We are also fervent supporters of internet radio and want more than anything for it to grow.” The petition doesn’t mention that Pandora is pushing the growth of its business directly at the expense of artists’ paychecks.

Fine print is one thing. But a musician could read this “letter of support” a dozen times and hold it up to a funhouse mirror for good measure without realizing she was signing a call to cut her own royalties to pad Pandora’s bottom line.

But tricking artists into signing a confusing petition without explaining what they are really being asked to support only poisons the well.

We’ve heard Pandora complain it pays too much in royalties to make a profit. (Of course, we also watched Pandora raise $235 million in its IPO and double its listeners in the last two years.) But a business that exists to deliver music can’t really complain that its biggest cost is music. You don’t hear grocery stores complain they have to pay for the food they sell. Netflix pays more for movies than Pandora pays for music, but they aren’t running to Congress for a bailout. Everyone deserves the right to be paid a fair market rate for their work, regardless of what their work entails.

We’re not saying that the music business is perfect or that there is no room to compromise. Artists would gladly work with Pandora to end AM/FM’s radio exemption from paying any musician royalties - a loophole that hurts artists and digital radio alike.

Other changes and compromises may be possible as well. The open letter to Pandora that we signed last year said, “Lets work this out as partners” and that’s what we should do. But tricking artists into signing a confusing petition without explaining what they are really being asked to support only poisons the well.

Note: Roger Waters, David Gilmour and Nick Mason are members of Pink Floyd. The above article was posted at usatoday.com.

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PANDORA PAYOUT FOR SONGWRITERS TOTALS $42 AFTER SONG PLAYED OVER 1 MILLION TIMES

Now that’s low.

Cracker’s 1993 hit “Low” had over 1.1 million plays on Pandora in the final three months of 2012, but David Lowery - the co-founder of the rock band and one of the composers of the song - was paid only $16.89 for the songwriter royalty.

Lowery posted his songwriter royalty statement on The Trichordist, a blog he helped start to represent artists. In the post, Lowery notes that Pandora paid 40 per cent of its fee for the over 1 million plays to him, with the additional 60 per cent, or $25.36, going to other members of the band.

But even when the fees are added together to total about $42 for the songwriters, the small sum underscores an increasingly common complaint from artists: While there are a growing number of streaming music and Internet radio services that connect fans with musicians, many artists feel cheated when it comes to compensation.

Pandora, the largest Internet radio service in the U.S., has been at the center of the fight. Last year, the company aggressively supported legislation that would significantly reduce the royalties it pays to artists and record labels. Pandora says it’s not fair that roughly 7.5 per cent of satellite radio revenue goes to royalties, while the streaming service must pay more than 50 per cent of its revenue out to artists.

Lowery, who also co-founded band Camper Van Beethoven, noted in his blog post that his payout didn’t include his performer royalty for “Low.” In a call with The Huffington Post, he estimated that sum to be roughly ten times his songwriter fee. “It’s higher, but also what I would regard as unsustainable,” he wrote on The Trichordist.

In a statement to HuffPost, Pandora said it’s “by far the highest-paying form of radio in the world and proudly pays both songwriters and performers.”

“Mr. Lowery misrepresents and grossly understates Pandora’s payments to songwriters,” a Pandora spokesperson said in a statement. The spokesperson said that Pandora must pay BMI and ASCAP, the organizations that represent songwriters and publishers, along with other parties - adding up to “many times more” in songwriter royalties than what Lowery noted in his post.

“These organizations - BMI and ASCAP - are the very same groups that recently agreed to a long-term licensing agreement with the terrestrial radio industry to pay songwriters significantly less than Pandora,” the spokesperson said.

Earlier this month, in an attempt to qualify for lower royalty rates, Pandora purchased a radio station in South Dakota. The company also filed a lawsuit last year against ASCAP, the performance rights organization, for lower rates.

But the vast majority of artists make very little money from Pandora and satellite radio to begin with. In 2011, almost 90 per cent of musicians who were paid by Soundexchange, the organization that pays royalties to musicians from satellite and Internet radio companies, received less than $5,000 each.

Lowery told HuffPost that he posted the songwriting royalty statement because Pandora is suing to cut royalty rates. Lowery noted that the low rate songwriters receive from Pandora is a rate that artists’ representation negotiated.

“As songwriters, unfortunately we cut a bad deal,” Lowery said.

In his royalty statement posted to The Trichordist, Lowery also highlights his songwriting fees from streaming music service Spotify. Although “Low” was played on Spotify about a tenth of the times it was played on Pandora, Lowery received $12.05 from that service.

Lowery is only the latest high-profile artist to speak out against Pandora. Over the weekend, the members of Pink Floyd published an editorial in USA Today in which they wrote that “Pandora is pushing the growth of its business directly at the expense of artists’ paychecks.”

Earlier this month, Spotify became the only free streaming music service to feature Pink Floyd’s entire music catalog.

It also hasn’t helped Pandora’s image much that its founder, Tim Westergren, has been consistently cashing in millions of dollars of stock over the last few months while at the same time asking artists to sign a letter to support Pandora’s efforts in Washington. - Timothy Stenove, huffingtonpost.com

Click here: Pandora responds to Pink Floyd, Royalty spat continues

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  1. One Response to “PINK FLOYD: PANDORA’S INTERNET RADIO ROYALTY RIPOFF”

  2. Good article to put on this site. thanks.

    By Mike Rotchertz on Jun 30, 2013

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