BMI Files Lawsuit Against Pandora Over Royalty Fees, Radio Station "Stunt"
June 14, 2013 1:28 PM
comment(s) - last by
BMI thinks Pandora is trying to be crafty with its recent radio station purchase in South Dakota
Broadcast Music Inc. (BMI) has sued
Internet radio company Pandora
for trying to lower the royalty rates it pays by buying a small radio station.
BMI filed the lawsuit at the U.S. Southern District Federal Court in New York yesterday. It's even seeking help from a federal rate court, which will decide how much Pandora will pay BMI members in royalty rates.
This situation stemmed from Pandora's purchase of a small radio station -- KXMZ-FM -- located in Rapid City, South Dakota. Pandora announced the purchase just two days before BMI launched the lawsuit.
BMI is accusing Pandora of buying the radio station so that it can enjoy the reduced royalty rates that terrestrial radio broadcasters receive. BMI gives terrestrial radio stations a bit of a break because of the higher fees these stations pay for on-air broadcasts. BMI said Pandora, on the other hand, is
primarily an Internet service
and shouldn't qualify for the discount that terrestrial radio stations receive just because it bought one tiny radio station in South Dakota.
"The action asks the court to set reasonable, market driven fees for Pandora after negotiations did not result in an agreement," said BMI. "BMI represents the public performance copyright interest of its affiliates when their works are played across all venues including the internet, cable, broadcast television and radio, satellite and in nightclubs, bars and other commercial establishments.
"This is the first time the organization has resorted to litigation on fees in the digital arena in the 18 years since it signed the first music industry copyright license for the performance of music on the internet."
BMI and Pandora had an agreement from 2005 to 2012. The contract ended October 2012, and when BMI sought a new contract, Pandora declined. BMI was looking for higher royalty rates due to the growth of online music streaming and market rates. Also, other music publishers -- such as Sony ATV Music Publishing -- left BMI last year to strike a deal with Pandora, leaving BMI with even less cash in its pocket. Sony reportedly got 25 percent more money with Pandora than it was receiving through BMI.
Around the time of the contract termination with BMI last year, Pandora also went to a federal rate court to drop the amount it owes to the American Society of Composers, Authors and Publishers (ASCAP).
"We look forward to the court's oversight of this matter," said Pandora spokeswoman Mollie Starr.
This article is over a month old, voting and posting comments is disabled
RE: Dont hate the player, hate the game.
6/18/2013 1:25:00 AM
If BMI left this gaping loophole open, then I agree with you, Pandora is doing right by their investors. However, if there is no loophole and Pandora is blatantly taking an adversarial tactic, then F-em.
According to Priya on Big Bang Theory, a dispute over ambiguity in a contract benefits the party whom did not draft the contract.
I would think it would come down to whether Pandora Inc., or whatever it's called, is the direct owner/operator of the radio station, or if it is still operated under a subsidiary. If Pandora is directly involved, then the discount would likely apply to them as a whole, if it is under a subsidiary, the discount applies to that firm's operations only.
Semantics are a bitch.
"DailyTech is the best kept secret on the Internet." -- Larry Barber
Pandora Unleashes Completely Revamped Website, Drops 40-hour Cap
September 21, 2011, 1:35 PM
"Mo' Money", Less Problems: Google Offers Cold Hard Cash for Finding Its Browser Bugs
October 1, 2014, 3:04 PM
eBay to Spin Off PayPal Business Next Year
September 30, 2014, 7:28 AM
Facebook to Use Your Browsing Data to Sell Offsite Display Ads
September 29, 2014, 3:52 PM
After Microsoft Complains, EU Rejects Google's Search Settlement for Second Time
September 23, 2014, 4:58 PM
Microsoft Expands Free Office 365 to All College Students
September 22, 2014, 3:21 PM
Apple Adds New Password Protection for Third Party iCloud Apps
September 17, 2014, 8:50 PM
Most Popular Articles
New AT&T Mobile Share Value "Double Data" Promotion Lasts Through October
September 28, 2014, 8:32 AM
Update: Apple Releases iOS 8.0.2 Update to Make Up for Botched 8.0.1 Release
September 25, 2014, 8:19 PM
Appalling Negligence: Decade-Old Windows XPe Holes Led to Home Depot Hack
September 8, 2014, 8:58 PM
TiVo Mega Features 24TB of Storage, Can Record Three Years* Worth of TV Content
September 8, 2014, 8:45 AM
FBI Outraged That Apple, Google are Adopting Digital "Locks" to Protect Users
September 26, 2014, 1:00 PM
Latest Blog Posts
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information