Money Matters - Simplified

Music industry attests its support against Pandora

Pandora has publicly supported Internet Radio Fairness Act, that would result in reduction of royalties paid to musicians and many music labels.

Over 100 musicians have attested their signatures on an open letter to Pandora, pushing the radio streaming station to pull back from supporting the Internet Radio Fairness Act.

The much controversial act left hundreds of musicians and thousands of others red faced, since it shall result in cutting the amount of royalties streaming music services have to pay musicians and music labels.

The campaign has fumed over the time with an ad spanning multiple pages, criticizing the act. The act, when passed, would change the current procedure of deciding royalty amounts for musicians as well as several music companies, for the songs played on Internet.

The ad in form a letter is titled as “A Musicians’ Perspective on Pandora" and has garnered support from some of popular artists such as CeeLo Green to KISS, the Temptations to Trisha Yearwood, and Missy Elliott to Jimmy Buffett.

The said open letter reads:
“We are big fans of Pandora. That’s why we helped give the company a discount on rates for the past decade,” the letter reads, continuing by pointing out “Pandora is now enjoying phenomenal success as a Wall Street company and skyrocketing growth in revenues and users. We celebrate that.

At the same time, the music community is just now beginning to gain its footing in this new digital world. Pandora’s principal asset is the music. Why is the company asking Congress once again to step in and gut the royalties that thousands of musicians rely upon?

That’s not fair and that’s not how partners work together. Congress has many pressing issues to consider, but this is not one of them. Let’s work this out as partners and continue to bring fans the great musical experience they rightly expect.”

Till now, the royalties paid to the musicians and music companies were more than what they earned from satellite radio streaming. While the Internet Radio Fairness Act aims at bringing the royalty paid in league of what the artists earn from Satellite Radio, the Artists too are in favour of similar earnings from both mediums, only difference being they want the Satellite Radio royalties to rise.