Pandora has officially abandoned the “Internet Radio Fairness Act,” a piece of legislation that would have effectively reduced the royalty rates it pays to songwriters and publishers, as well as performers and labels. Pandora founder Tim Westergren attributed the change of heart to “the low probability that Congress will address this issue in the near term,” but strong resistance and bad press from initiatives like ASCAP’s #StandWithSongwriters petition and an open letter signed by prominent artists opposing the bill might be a factor.
Industry experts speculate that Pandora is redirecting its efforts to lower royalty rates by other means, possibly by lobbying the Copyright Royalty Board (CRB)––the three-judge panel that sets statutory rates for webcasters. With different members on the CRB from Pandora’s last attempt, the company may take its chances rather than attempting passage of a bill in Congress. The company could also seek direct deals with publishers and labels––a strategy that has already been adopted by Pandora’s largest competitor, iTunes Radio. See http://pandora.com.
