1 Million Plays on Pandora Nets Only $16.89? Rep Calls Out Musician for Fuzzy Math

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Pandora, the internet radio service which, as of June, claims a 7 percent share of total U.S. radio listening, is taking issue with a blog post authored by Cracker and Camper Van Beethoven frontman David Lowery, in which the outspoken singer blasted the company. Lowery’s assertion: that 1 million plays on Pandora yielded a net payment of just over $16 (representing 40 percent of the songwriting for hit song “Low;” the total earnings for the million-plus streams come out to around $42).

In addition to posting his own royalty statements, which purport to show a wide gap between payments Lowery received for play on terrestrial radio (more than $1500), he writes: “Soon you will be hearing from Pandora how they need Congress to change the way royalties are calculated so that they can pay much much less to songwriters and performers. For you civilians webcasting rates are ‘compulsory’ rates. They are set by the government (crazy, right?). Further since they are compulsory royalties, artists can not ‘opt out’ of a service like Pandora even if they think Pandora doesn’t pay them enough. The majority of songwriters have their rates set by the government, too, in the form of the ASCAP and BMI rate courts — a single judge gets to decide the fate of songwriters (technically not a ‘compulsory’ but may as well be).  This is already a government mandated subsidy from songwriters and artists to Silicon Valley.  Pandora wants to make it even worse.”

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He closes his post by urging “all songwriters to post their royalty statements and show the world  just how terrible webcasting rates are for songwriters.”

But a Pandora spokesperson takes issue with Lowery’s math, telling The Hollywood Reporter, “Mr. Lowery’s calculations grossly understate Pandora’s payments to songwriters.” Pandora claims quite the opposite: that it “is by far the highest paying form of radio in the world. … For perspective, to reach the exact same audience, Pandora currently pays over 4.5 times more in total royalties than broadcast radio for the same song.”

An analysis of royalty rates conducted by tech blogger Michael Degusta and posted at theunderstatement.com estimates that the song actually brought in around $1,300 for a million plays. Subtract the various parties who get a cut of that royalty — from SoundExchange to the record company to ASCAP and/or BMI — and Lowery, as a 40 percent stakeholder, would have pocketed around $234, Degusta posits.

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