Is There Movement In The Royalty War Between Artists And Pandora?

A Thaw In The Heated Conversation?

The war of words between artists and PANDORA has been heating up lately, with three members of the iconic Classic Rock band, PINK FLOYD, penning op-ed piece in USA TODAY (NET NEWS 6/24), weighing in on royalty rates, followed by a blog post by CRACKER frontman DAVID LOWERY (NET NEWS 6/25), who posted royalty receipts, expressing his frustration with the situation at PANDORA.

But there could be some progress, reports THEVERGE.COM, which reports "PANDORA, the web's top radio service, has held preliminary discussions with groups representing music artists as well as indie and major labels about ending an increasingly aggressive feud over music royalties."

While no one is actually sitting down yet, "formal negotiations are expected to start soon," sources told THE VERGE.COM, which adds, "this is the first indication that the parties are interested in amicably resolving the issue of how much to charge web radio services for music. The two sides began waging a public relations war against each other when PANDORA went to CAPITOL HILL with legislation that would lower future music royalties."

Pandora Responds To Pink Floyd And David Lowery

In response to PINK FLOYD's USA TODAY op-ed, a PANDORA spokesperson told ALL ACCESS:

"We have enormous respect for the members of PINK FLOYD, and their amazing artistic contributions. We also respect the genuineness of their opinion. Unfortunately, they have been given badly misleading information -- the result of a well-orchestrated campaign by the RIAA and their lobbying arm to mislead and agitate artists. A glaring example is the assertion that PANDORA supports an '85% artist pay cut'. That is simply not true. We never, nor would we ever, support such a thing. In fact, PANDORA has suggested solutions that would guarantee no reduction in artist payouts while also nurturing the growth of internet radio -- a medium that is crucial to thousands of independent musicians who don’t enjoy major label support or FM radio exposure.

"This much is true: PANDORA is by far the highest paying form of radio in the world and proudly pays both songwriters and performers. For perspective, to reach the exact same audience, PANDORA currently pays over 4.5 times more in total royalties than broadcast radio for the same song.  In fact, at only 7% of U.S. radio listening, PANDORA pays more in performance royalties than any other form of radio."

PANDORA also took exception to CRACKER frontman DAVID LOWERY's blog post. PANDORA told ALL ACCESS:

"Mr. LOWERY's calculations grossly understate PANDORA’s payments to songwriters. In truth, PANDORA paid many times more in songwriter royalties to play the song referenced in his article.  The post also neglects to mention that the rates PANDORA pays were set by the very organizations that represent songwriters and publishers. 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.

"This much is true: PANDORA is by far the highest paying form of radio in the world and proudly pays both songwriters and performers. For perspective, to reach the exact same audience, PANDORA currently pays over 4.5 times more in total royalties than broadcast radio for the same song.  In fact, at only 7% of U.S. radio listening, PANDORA pays more in performance royalties than any other form of radio."

musicFIRST Rebuts Pandora Rebuttal

On the other hand, the MUSICFIRST coalition wasted no time in countering PANDORA's rebuttal to the PINK FLOYD and CRACKER allegations. In the latest blog on its website, the artist-rights group noted that the assertions PANDORA asserted was misleading were from its own books.

"PANDORA claims the band got 'misleading information' regarding PANDORA’s desire to cut artists’ pay by 85%," MUSICFIRST noted. "But ... the information comes from IRFA’s sponsors and PANDORA’s TIM WESTERGREN himself.  The company said the idea behind IRFA is to remedy the difference between Internet radio royalties (50% of revenue) and satellite radio (8% of revenue).  Going from 50% to 8% is about an 85% cut. It’s simple math."

What's more, "it’s hard to know what the doubletalk about 'no reduction in artist payouts' means, but I would like them to show us where that 'guarantee' is in the bill the company is pushing. It’s not in there."

Read the entire blog here.

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