Feeds

We're being royalty screwed! Pandora blames price rise on musos wanting money

Tchah, the cheek of them, writing songs, expecting cash

Choosing a cloud hosting partner with confidence

Streaming music biz Pandora will raise the price of its One subscription service, blaming a jump in royalties it has to pay out to record labels.

The company on Wednesday said that it will raise the cost of its online service from $3.99 per month to $4.99 for new users. Pandora said that current users will not be subject to the price hike for the time being.

The increase, it's claimed, is a reflection of rising licensing costs Pandora must pay labels for streaming their tracks over the internet. The company said that a content licensing deal it maintains with royalty collection firm SoundExchange has seen prices escalate by 53 per cent over the last five years. Additionally, Pandora claims that SoundExchange will raise rates another nine per cent by the end of next year.

As such, Pandora said it has to up the cost of its One subscription service, which was launched in 2009 and pipes songs to users without advertisements interrupting the stream. Users not wishing to pay the monthly fee can opt for the free Pandora service, which occasionally broadcasts ads between tracks.

Pandora – based in Oakland, California – claimed that it has 3.3 million subscribers on the One service. The free Pandora option boasts more than 250 million registered accounts.

Royalty fees have long been an issue of contention between Pandora and the record companies. The streaming music service has fought labels over what it claimed where prohibitively high costs for every song it streams, and in 2008 the two sides agreed to a settlement in which SoundExchange would collect royalties from Pandora on behalf of artists and labels.

Critics of the web biz have charged that the company in fact short-changes rights holders and pays minuscule fees to stream songs compared to other broadcasters.

"A business that exists to deliver music can't really complain that its biggest cost is music," psychedelic Brit band Pink Floyd told to the company last year in a protest over payments. "You don't hear grocery stores complain they have to pay for the food they sell."

Pandora, which opened its doors in 2000, also announced that its chief technology officer, Tom Conrad, will be leaving the company. A 10-year veteran of the biz, Conrad will step down from his post but remain with Pandora in an advisory role. Vice-president of engineering Chris Martin will take over the CTO position. ®

Beginner's guide to SSL certificates

Whitepapers

Choosing cloud Backup services
Demystify how you can address your data protection needs in your small- to medium-sized business and select the best online backup service to meet your needs.
Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
The hidden costs of self-signed SSL certificates
Exploring the true TCO for self-signed SSL certificates, including a side-by-side comparison of a self-signed architecture versus working with a third-party SSL vendor.
Top 5 reasons to deploy VMware with Tegile
Data demand and the rise of virtualization is challenging IT teams to deliver storage performance, scalability and capacity that can keep up, while maximizing efficiency.