For more than two years now I have been eagerly anticipating the day when I could finally write these words: the royalty crisis is over!
Webcasters, artists, and record labels have reached a resolution to the calamitous Internet radio royalty ruling of 2007. Pandora is finally on safe ground with a long-term agreement for survivable royalty rates. This ensures that Pandora will continue streaming music for many years to come!
Many people played a role in getting here. Pandora listeners provided support in extraordinary numbers in Congress, and a group of reasonable and constructive voices on the label and artist side of the table (groups like A2iM) helped forge a middle ground that, while perhaps not meeting all of our aspirations, still represents a thoughtful and reasoned outcome under the circumstances.
For this we are truly thankful and want to express our deepest gratitude to everyone involved.
The revised royalties are quite high – higher in fact than any other form of radio. As a consequence, we will have to make an adjustment that will affect about 10% of our users who are our heaviest listeners. Specifically, we are going to begin limiting listening to 40 hours per month on the free version of Pandora. In any given month, a listener who hits this limit can then opt for unlimited listening for the remainder of that month for just $0.99. In essence, we’re asking our heaviest users to put a dollar (well, almost a dollar) in the tip jar in any month in which they listen over 40 hours. We hope this is relatively painless and affordable–the same price as a single song download. (Alternatively, they can upgrade to “Pandora One”, our premium version which offers unlimited monthly listening in addition to its other benefits).
We hate the idea of limiting anyone’s listening, but we have no choice but to react the economic realities of the new rates.
There continues to be royalty-related activity in Washington DC. On the heels of the above resolution, there is a new effort in Congress to fix the broader issue of how musical artists are compensated across all forms of radio. The system as it stands today remains 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. We, along with the artists whose music we play, strongly support the establishment of a level playing field, a truly fair system, as articulated in a new bill called the Performance Rights Act (H.R. 848).
It has been an extraordinary couple of years. Believe me, I never thought I’d be donning a suit and tie to walk the halls of Congress lobbying for a bill. Thanks to all of you for your continued support. It is incredibly exciting for everyone at Pandora to see the vision for the company truly beginning to take shape. We are all looking ahead with renewed vigor to the future.
Cheers.
Tim (Founder)

Comments

  1. аксессуары
    November 08, 2009 at 6:54pm
    Hello! Thank you very much for that enlightening article
  2. asos
    November 20, 2009 at 6:30pm
    This is terrible. I will no longer use pandora anymore!! Thanks!
  3. gccradioscience
    November 22, 2009 at 11:50am
    I will consider putting money into it when I get time, but right now I have other things I have to pay for such as.... groceries, health care needs, and other things I need. If Pandora cannot afford the project, then simply drop it altogether. And I feel bad for those not having any access to Pandora. http://www means worldwide web, not USA only access.
  4. leighla222
    November 26, 2009 at 11:06pm
    Wow. Pandora, wow. Thanks, Tim.
  5. leonardo
    December 09, 2009 at 5:59pm
    36 bucks is 3 dollars a month. 3 bucks is like 10 cents a day. I'd gladly drop a dime in a machine to listen to music at work all day without annoying ads. Except my upgrade shortly to paid service. Having an excuse like "Oh I have to pay for groceries" is dumb because I don't even have income (I'm an unpaid intern) and I'm willing to shell out for this great service. It's far better than what I used to listen to, which was clear channel's internet radio service that always seems to have a broken stream that screws everything up.
  6. Scynfewl
    January 03, 2010 at 5:19am
    Excellent! I had not hit the limit until yesterday and didn't really know that it was there. I think the Pandora service is excellent ans well worth the fee. When I first discovered Pandora over a year ago I told all of my friends and family, even going as far as to say, "I'd even pay for this stuff". Sounds like exciting times for a growing company. Thanks so much!
  7. RL
    January 04, 2010 at 12:29am
    Just un-installed Pandora off my Droid. Peace out.
  8. David
    January 16, 2010 at 10:01am
    To this day I find it curious how many people sincerely believe they are entitled to access to someone else's creative genius for free, without effort. Then bitch and go elsewhere to pout when asked to pay a dollar. One comment to Tim: Since when do artists not get paid for their music when it's played on AM/FM? Does ASCAP know this? Or BMI? Where do you think the royalties paid by radio stations go?
  9. Sam Jones
    January 17, 2010 at 8:51pm
    Quoth: "I also think pandora should do a prepaid skip feature, like $5 for 500/250 skips or something like that." That's an awful idea. Limited skips are "manufactured value". Far better to have three stations and flip between them.
  10. SpecterMan
    January 18, 2010 at 1:59am
    I was actually looking around trying to figure out why Pandora isn't running in Canada. I've gotten as far as the fact the Canadian royalties either won't allow internet streaming or are too expensive? Can anyone fill me in on exactly whats going on here?

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