A rate court judge has issued a ruling in the argument between Pandora and the American Society of Composers, Authors and Publishers (ASCAP). Judge Denise Cote ruled that Pandora would pay ASCAP, a non-profit which handles copyrights and issues royalties for its members, 1.85 percent of its annual revenue. For those unfamiliar with the going rates for music streaming services: Pandora's the winner here, and ASCAP isn't happy.
ASCAP suggested during the case that the 1.85 percent rate would be applicable for the first two years, to ease Pandora into paying the higher rates ASCAP believed it was due. The following year would bring a 2.5 percent rate, and then 3 percent during 2014 and 2015. Pandora claimed that it should be subject to a 1.7 percent rate on the "low end," and at most 1.85 percent. Although the internet radio station got stuck with its "upper limit," they still seemed pleased, with an anonymous source from the company referring to it as "an unqualified victory."
ASCAP's comments were more evocative.
"This rate is a clear defeat for songwriters," said Martin Bandier, the CEO of Sony/ATV Music, and ASCAP member. "This rate is woefully inadequate and further emphasizes the need for reform in the rate court proceedings. Songwriters can't live in a world where streaming services only pay 1.85 percent of their revenue. This is a loss, and not something we can live with."
Pandora's logic was that it should receive the same rate that land radio broadcasters pay, which is 1.7 percent. Cote rejected that notion, but she also opposed the progressively rising rate proposed by ASCAP.
Nothing is set in stone yet. BMI, another music publisher, is bringing a similar suit against Pandora, and if the judge in that case rules differently, things could be thrown into flux again.
