Pandora’s share price dropped 19% in after trading on the NASDAQ after the company confirmed a $90 million payout to copyright holders.
Many of the major streaming businesses, along with satellite delivery company Sirius/XM, have stood behind an interpretation of various state and federal copyright laws that they say relieves them of paying royalties on any recording they play from before 1972.
While some progress has been made, both in the courts and in negotiations, there are still many problems but one big one was alleviated on Tuesday when Pandora agreed to pay $90 million in back royalties for use of the older recordings. The agreement was made between Pandora, ABKCO Music & Records, Capitol Records, Sony Music Entertainment, UMG Recordings and Warner Music Group.
RIAA Chairman and CEO Cary Sherman said “Major settlements with SiriusXM and now Pandora means that an iconic generation of artists and the labels that supported them will be paid for the use of their creative works. That is a significant milestone and a big win for the music community. We appreciate the collaborative and constructive approach of Pandora’s team in resolving this longstanding issue for artists and labels.”
Brian McAndrews, CEO of Pandora, said “Pandora is excited to have found resolution with these record labels. Together we share a common objective to grow the music industry and support artists. We pursued this settlement in order to move the conversation forward and continue to foster a better, collaborative relationship with the labels.”
So the fight goes on with issues such as terrestrial radio’s long-standing refusal to pay any royalties to artists and record companies (they do pay songwriters and publishers), arguing that they are giving free publicity for the recordings. The Fair Play Fair Pay act continues to take the slow road through congress in its quest to fix the radio situation along with levelling the playing field across all forms of media in the paying of performance royalties.
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