Pandora is by far the best streaming radio site I have ever used. I listen to Pandora more often than my own MP3 music library because it offers a great variety of new songs from a database that is constantly being updated (currently over 600,000 songs are being streamed). I have discovered several new bands that have grabbed my attention and re-discovered classic songs that I have long since forgotten.
However, a new ruling from a 3-person Library of Congress panel may change the face of Pandora and all other Internet radio sites for good, possibly causing them to call it quits.
The Copyright Royalty Board has made a decision that would triple the royalties that Internet radio sites would have to pay to performers. The new rate, $.0008, seems like a miniscule amount, but with millions of users it adds up very quickly to an overwhelming amount for such companies. Let’s say Pandora streams 20 million songs in a day. That means they have to dish out $16,000 in performer royalties alone just for that day. Add that to their server and employee costs and their profits start to dry up.
In this video from Download Squad, Tim Westergren, founder of Pandora, is interviewed about the current risks facing the company and its grim future should this ruling take full effect. If the appeals process fails, we may have to say sayonara to our favorite Internet radio site.
[via Download Squad]
Tags: Pandora, internet radio, streaming, copyright royalty board
