Pandora: If We Pay Royalty, So Should Radio ... As It Raises $35M More
July 13, 2009 at 8:14 AM (PT)
On the heels of agreeing to a performance royalty with SOUNDEXCHANGE, PANDORA Founder TIM WESTERGREN sent an e-mail to his audience, essentially saying if a royalty of good for Net radio, it should be good for terrestrial radio, too. Meanwhile, PANDORA attracted $35 Million from a new major investor in its service.
In his e-mail sent last week, ARS TECHNICA reports that WESTERGREN called the current system "fundamentally unfair both to Internet radio services like PANDORA, which pay higher royalties than other forms of radio, and to musical artists, who receive no compensation at all when their music is played on AM/FM radio." He then called on his faithful to contact House Majority Leader NANCY PELOSI's office and request that she support on the Performance Rights Act, which would put terrestrial radio on a "level paying field" in compensating rights holders through a performance royalty.
Shortly after announcing a new royalty payment deal with the music industry, PANDORA has confirmed that it ha raised new funding from GREYLOCK PARTNERS, reports CNET.COM. "The size of the round is $35 million, according to a FRIDAY report at PE HUB, a forum for private equity discussion. PANDORA confirmed that GREYLOCK PARTNERS led the investment and said DAVID SZE from the venture capital firm has joined its board.
"Consistent with our past practice, the amount and valuation are not being disclosed," the company said in its statement. "New funds will be used toward the continued growth and development of PANDORA."
"PANDORA is among Internet music-streaming sites that last week reached a music royalty deal with SOUNDEXCHANGE, the group that collects royalties on behalf of artists and labels.
"Existing investors include CROSSLINK CAPITAL, WALDEN VENTURE CAPITAL, LABRADOR VENTURES, KING STREET CAPITAL, HEARST CORPORATION, DBL INVESTORS and SELBY VENTURES, PANDORA said."