On The Other Hand #2: Spotify at Least Negotiates, Pandora Refuses to Pay, Sues Songwriters and asks for Government Handouts

Spotify isn’t necessarily the enemy of performers and songwriters.  No I don’t like the rates I am paid (as either performer or songwriter).  My main beef with Spotify (and the deals labels cut) is that I wish I didn’t have to have all my catalog on  the service.   I’d simply like to be able to opt-out.  And if I control enough of my rights I can.  Spotify is a legally licensed service that negotiated deals with large blocks of rights holders.  It may have been bad business for performers and songwriters but it was just that: A business. A legally operating business.

However I’m not sure you can same thing about Pandora.   Pandora has conducted a scorched earth campaign against artists and songwriters.  Refused to pay on pre 1972  recordings despite recent court rulings.  Sued BMI and ASCAP for lower rates. In the ASCAP case there were tens of millions of dollars spent in legal fees to save a few million dollars a year? Pandora spent millions lobbying congress to pass a FEDERAL law that would have mandated artists take up to a 60% pay cut.  Who does that?  What kind of business goes to the US Congress to force it’s suppliers to take less? Also in what appears to be some sort of bizarre publicity stunt,they claimed to have bought a radio station in South Dakota (it’s still not clear they have all the assets that would allow them to really claim this).   The idea here may have been that they would pay  lower royalties as a terrestrial and web broadcaster? Each of these “events” was loudly proclaimed as “good news” for Pandora and it’s stock price in the financial press.    Why?   I don’t really know but maybe it has something to do with this:

By the end of 2015 executives and investors will have sucked nearly 1/2 billion dollars in “stock compensation”  out of the company. A company that has yet to make a dime in profit. 

Pandora does not seem like an actual “business” to me.  You readers are smart enough to draw your own conclusions.

While I’m not a huge fan of Spotify they have negotiated and despite the hardball stance on free tier of streaming have generally played by the rules.  Yes there may be a sort of Cold War between artists and Spotify, but there are rules.

So lets run with that analogy.   If Spotify is like the old Soviet Union what do we make of the DeadEnders over at Pandora?  Pandora has just about destroyed the music licensing system through their scorched earth policies.  The Copyright Office came as close as they could to pointing the finger at Pandora in their recommendations for music licensing reform. One could argue that  the last three years of Pandora rate court shenanigans is the very reason that the Copyright Office decided to study the music licensing process in the first place!

So if Pandora doesn’t care if they destroy the federal licensing process on which they and every  TV, radio station, restaurant and venue in the country depends what are they?   They are not a business.

In our analogy Pandora is more like ISIS?




About Dr. David C Lowery

Platinum selling singer songwriter for the bands Cracker and Camper Van Beethoven; platinum selling producer; founder of pitch-a-tent records; founder Sound of Music Studios; platinum selling music publisher; angel investor; digital skeptic; college lecturer and founder of the University of Georgia Terry College Artists' Rights Symposium.

2 thoughts on “On The Other Hand #2: Spotify at Least Negotiates, Pandora Refuses to Pay, Sues Songwriters and asks for Government Handouts

  1. Wow. Extremely scary to think about that. Thanks for opening our eyes on this subject. This is something I have not educated myself as much as on other things. There has to be a solution. What Americans don’t understand, is that this threatens our very nation. Think I’m going overboard? Capitalism was built on being able to come up with an idea, own the rights, and sell the idea. Every product you see on the shelves today has some sort of protection. So why the hell can’t songwriters have the exact same rights? We did 10 years ago. What happens when other ideas get stolen. This is only the beginning. And there needs to be a movement.

    • There is a solution. An easy one. Our constitution provides that creators (such as song writers) are entitled to exclusive rights to their work. In fact that right has been honored since the concept of recorded music began. Our country also has a long history of protecting property rights, which according to our constitution includes creative works. The question is why is that not the case now?

      One thing that is clear is that we do not live in ordinary times. There has been no time since the 1800’s where moneyed interests have had as much power as they do today. The mere fact that Citizen’s United has occurred shows that we live in an age where democracy is somehow the right to buy legislation.

      There is a certain judge in New York who seems to be in Pandora’s back pocket. To her, songwriters are somehow a monopoly threat to poor Pandora. Yes, they are a threat to Pandora – a company that has majority market share of the streaming radio business of it’s type. So she allowed Pandora to use an obscure court ruling of the 1940’s to FORCE musicians to allow Pandora to use their work at a rate that is far below what any sane musician would do otherwise. In enforcing this ruling, this judge has overturned musicians ‘ constitutional rights to due process as well as their rights they are entitled to their creations.

      If this appears to not make any sense, it does not. Her rulings are ridiculous, at best. So my question is – why has this judge made repeated non nonsensical rulings that all benefit Pandora? Does she have some secretive financial ties to Pandora? Or is she just terribly ignorant and performing a job she has no right to do?

Comments are closed.