An article appearing in The Hollywood Reporter explains why US District Judge Louis Stanton decided that Pandora should pay 2.5% of its revenue to BMI. The decision came more than two years after publishers attempted to partially withdraw digital rights from BMI in order to get a raise from streaming outlets like Pandora. BMI argued the court for a 2.5% rate based on interim deals that were struck between the publishers and Pandora. In making the decision, Stanton considered Pandora’s $600 million 2014 revenue, and its stance that it hasn’t been profitable due to lack of success on the advertising. He also looked at what music services are paying—Apple 4.6% of revenue, Spotify (2.5%-6.25%) of label costs, and Rhapsody, just under 2.5%—though he admits “Pandora evades neat categorization.” BMI I was also given a “win” in that the license term will be four years, instead of five, to allow re-evaluation of the licensing relationship given the “rapidly changing nature of the online music industry.”
Tag Archives: music industry
99 Problems with the Music Industry
I’d like to continue building on last month’s report, and my dissection of the “new business model.” I recently ran across an article by Paul Resnicoff, entitled “99 Problems with the Music Industry,” and while written some months ago, it has an interesting perspective on the current state of affairs. One might argue that some of the points are from an older era, their relevance is still noteworthy. Here are some highlights: