Internet Radio Companies Crippled By High Song Fees

Pandora is one of the nation's most popular Web radio services, with about 1 million listeners daily. Its Music Genome Project allows customers to create stations tailored to their own tastes. It is one of the 10 most popular applications for Apple's iPhone and attracts 40,000 new customers a day.

Yet the burgeoning company may be on the verge of collapse, according to its founder, and so may be others like it.

Read the whole story here.

Comments

[InofTouch]

if it dies, it dies

nobody cryed when Naspster 1.0 ended and look now. MP3 are riseing

[rollingdivision]

The free market works, soon the major music industry dinosaurs will go the way of the newspaper industry.

[walk0nwalls]

Yo! RIAA! If we can't get it from the internet we're just going to download it for free!

[ChescoMom]

" 'Our artists and copyright owners deserve to be fairly compensated for the blood and sweat that forms the core product of these businesses,' said Mike Huppe, general counsel for SoundExchange."

Uh, no, Mike, to you that would just be the record companies.
Old Corporate Media has stampeded into the wild frontier known as the Internet, and before anyone can catch their breath, wrestles and wrangles innovators to the ground, demanding the most amount of money from users for the least bit of content. Truly disgusting.

[ktano0]

If I am not mistaken, sattlelite radio does not pay those high royalties, either. I'm not usually a conspiracy guy, but I think those people in that obscure federal agency should be investigated a little.
I mean, I subscribe to xm on internet, but I always listened to Pandora more. I wouldn't be surprised
if a lot of people were like me.

Makes you go hmmm....

[theHardTruthFairy]

FYI: Satellite radio does pay royalty fees.

[ktano0]

The operative word in my comment was "high". As I understand it, sattlelite radio royaties are paid on a different (lower) scale.

[Destin]

First off, this quote.....

"Last year, an obscure federal panel ordered a doubling of the per-song performance royalty that Web radio stations pay to performers and record companies."

"Traditional radio, by contrast, pays no such fee."

WHAT federal panel made this decision?? And why is it such a lopsided decision that is tatamount to a suppression of technology. Much like Big Oil pays the Govt to suppress alternative energy technology, you can bet the record companies do the same thing to suppress electronics technology. Plus, who were the politicians involved in this decision? There's an election coming up and I'd like to vote against anyone who come up with such an idiotic ruling.

And the RIAA is really shooting itself in the foot bigtime. Because all this will do, is encourage rampant piracy that let's people get what they want. What are they gonna do, stop marketting music completely, and then how would they put out their bands music?? ;)

At least with streaming internet radio, it's a legitimate listening venue with NO PIRACY INVOLVED.

I think the REAL reason the RIAA is going after streaming radio stations, is because it takes away the RIAA's power to force people to listen to what the RIAA wants. That's ALL it is about, power and money. Greed, in simpler terms. But power most of all.

[dp53]

Just another sad example of old guard, unimaginative thinking.

"We don't do it that way. We've NEVER done it that way. It can't be done that way."

It's a shame, Pandora is a great site which, as was pointed out here already, introduces listeners to artists they might never have encountered if left to depend on the music industry's antiquated marketing and promotion model. Artists whose music those listeners eventually purchase.

Pandora will probably go down as a result of this, but the dinosaurs in the music industry should refrain from celebrating. It's their own throats they've cut.

[Harrier]

I's unfortunate but I think the recording companies are so far behind the curve and taking so long to adjust to technology, they are going to destroy themselves in trying to keep ahold and control distribution channels so closely. It's only a matter of time, if they keep this attitude, they get replaced.

If they think they are going to sell a disc for $20.00 that take them $ 0.37 to produce with their marketing and distribution expenses ect. those days are gone long ago. Those fat profits for nothing are gone because they didn't figure out the technological game quick enough.

If people feel you're gouging them, they will simply get it for free.

[daddydamon]

I haven't bought a cd in like 10 years.

[ThankGodforAtheists]

What a shame. Pandora is the only music radio I listen to. I have discovered many artist that I like as a result. Regulators really need to level the royalty playing field between the various types of broadcasters. If they don't, they will have protected the rights of artists by diminishing the paying listening audience. Sounds like cutting off their nose....

[marymansour]

I am a huge fan of internet music programs. Hate to hear this bad news.

[kulenski]

Save net radio!!!

[OutsourcedAgain]

Sad! The same corporations win again. When you hear a republican talk about "the small shop" owner, remember what they are doing to these emerging businesses.

[citizenofmars]

oh c'mon and post the second part--geezez!!

[WorkingClass]

What does ASCAP (or anyone) gain by killing Pandora? I don't get it.

[gfredsen]

Coyote4, there are international copyright laws so it might not be that easy.
I would like to know how these companies think I am ever going hear their new artists. Answer is that I am not. With Pandora I can make a Coldplay station and be exposed to similar artists that I might like. You think they don't get that, when the truth is they don't care. It is all about getting all the money you can get right now. Talk about an industry shooting itself in the foot. That is why I like Jamendo.com and you should, too.

Boycott POP MUSIC. It mostly s ucks anyways. And I sure agree with that. I have about a thousand classical and jazz CDs and records, yes records, so I will just listen to those and buy no more new artists as I won't know about them.
The ASCAP can go whiz up a rope.

[cdembrey]

ASCAP is not the problem. It is the RIAA and Sound Exchange who are demanding unreasonable rates from internet radio.