/// Pandora Says Musicians Will Get More if It Pays Less. How Does That Work?

July 1, 2013  |  All Things Digital


The latest round of Pandora vs. the music business is really complicated, because music licensing is really complicated.* It’s also very simple: Pandora wants to spend less money on music rights every time it streams a song over the Web. Many people who own music rights want Pandora to spend more. But wait a minute. Doesn’t Pandora say that’s not true? In a blog post published last week, founder Tim Westergren said Pandora is actually “advocating for solutions that would grow total payments to artists.” It’s a message he repeats all the time, as in yesterday’s interview with the Financial Times : “Our goal is to have those total payments go up.” Time for a translation: What Westergren and other Pandora executives are really arguing is that if they spend less on each stream of music they distribute, rights-holders will collectively end up with more money. Perhaps they are not being as clear about that as they ought to be, and perhaps that’s because the argument is a bit hard to accept. Because Pandora’s rights payouts are based on usage. And Pandora users, who don’t pay for the ad-supported service,** won’t listen to more or less music if the company’s fee structure changes. So how would lower streaming fees end up growing the pie

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Pandora Says Musicians Will Get More if It Pays Less. How Does That Work?


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