Pandora May Turn Off Its Streams: Do You Care?

pandora.jpgI’ve been putting off writing a post about the possible demise of the Music Genome Project-powered streaming site Pandora–which may be sunk because it might have to pay royalty fees that add up to 70% of its revenues–for most of the day, because I’m not really sure how I feel about it. On the one hand, yes, the royalty structures set up by the fee-collecting regulatory body (and RIAA spinoff) SoundExchange are a bit high, and do encourage a lot of new sites to operate in the dark so they can get out of bankrupting themselves right away. On the other hand, SoundExchange doesn’t solely represent artists on majors, and I’m wary of sites like Pandora that seem to want to have their cake (creating technology that’s all about sampling music for free) and eat it too (not paying musicians under the guise of “promotion” and keeping any revenue for themselves). And on a third, possibly selfishly concealed hand, I don’t really use Pandora; the few times I have sampled it, its utility has been spotty at best; and I’m wary of the online outcry in favor of the service, because of the whole outsized importance of technologically triumphant Digg Nation types in any debates involving the intersection of music and technology. So, readers, I’m opening the floor to you all, in hopes that someone out there can convince me to pick a side. Think of it as a chance to dust off those debate-team-honed skills! [WP]

 

  • SomeSound-MostlyFury

    I never found good recommendations on Pandora, but Last.fm never did well either. The best part of Last.fm is/was "neighbor radio," which played favorites of people whose interests were most similar to yours. That stream gave me more new bands than Pandora ever did.


    @owenmeany: I like Slacker, too. For a site whose main gimmick is the portable radios that they sell, they give me better recommendations than much bigger sites.

  • cheesebubble

    I dabbled with Pandora in its earlier days but was unimpressed with a lot of its recommendations. So if it dissolves into the ether I'm unaffected. I forgot all about it but with the news of an impending demise, I've read quite a bit about it as of late. Obviously a number of people enjoy Pandora so it's too bad that the service may go the way of the dinosaurs. And yet something's bound to rise from the ashes and fill the void. There are a lot of smart, enterprising people out there in computer technology land.

  • themiserabilist

    I've always liked Pandora and my feeling is that the more you stick with it and rate the songs the better it serves the curious listener. But it won't be long now before every music-related online resource (radio, stores, etc.) is using similar parameters to help drive more RIYL results. In fact, Pandora could possibly sell off its database of song attributes in the way that All Music sold off band profiles and album reviews. (If they're not already, that is.) The larger problem here is advertising on the internet. With rare exception it just doesn't generate the revenue that other (older) media can and mixing the two in cost structures (i.e. Pandora and SoundExchange) just can't make sense until advertising begins to pull in the money that it traditionally generates in other media. Pandora's user base is sizable enough that their survival shouldn't be in question, but it's a sign of how far we still have to go to figure out how to get this whole internet thing to play nice with the rest of the media world.

  • DJorn

    I've used it a few times, liked it, never got addicted, know people who love it. To me, the biggest problem here is that if the new rates put Internet stations out of business (and if one as big as Pandora goes, they're all going), that means zero money for artists. A classic case of the music industry shooting itself in the foot, eliminating profits by trying to maximise them.

  • Maura Johnston

    @TheContrarian: Totally agreed. (Especially about the 'faith forum' being ludicrous. Oy.)

  • TheContrarian

    @Rev.Keith: SoundExchange is not the devil. They are also not RIAA shills. The board is balanced between the indie and the mainstream sectors.


    They certainly erred in their initial push for one-size fits all webcasting rates. But as it has been previously been pointed out, Pandora doesn't have the right to legislative protection of a wobbly business model.


    That said, Pandora is an innovative, interesting application that no doubt exposes people to new music that they may theoretically pay for. If prohibitive royalty rates cripple this type of service before it has a chance to stabilize, we lose yet another enticement to the legal online accessing of music.


    Instead of being split into camps spitting apocalyptic nonsense at one another, the two factions should work in earnest to come up with a solution that not only serves the interests of business, but also those of the artists and fans.


    How this might be accomplished is, as Obama ludicrously said in that equally ludicrous *faith forum,* "above my pay grade."

  • Anonymous

    Yeah! What SHE said!

  • Maura Johnston

    @RevKeith: I have musician friends who have been paid not insignificant amounts by SoundExchange. And I agree with you that the artists do generally get screwed in these cases. It's an imperfect system that definitely needs to be revamped from the ground up -- and I think the majors are going the wrong way by saying, "OK, fine, let's force terrestrial radio to pay a performance royalty as well" -- but if sites like Pandora want to make their bones off advertising that's consumed while their algorithm disseminating other peoples' content, they shouldn't moan and groan about diverting some of that money to the content providers. (Why does Pandora need 30 ad sales reps, anyway?) There's a definite whiff of "up with technology, the artists can figure it out" here that rankles with me, if only because that attitude has been *so* prevalent among tech types in general because they just think that culture they want to consume will appear through magic.

  • Anonymous

    "On the other hand, SoundExchange doesn't solely represent artists on majors, and I'm wary of sites like Pandora that seem to want to have their cake (creating technology that's all about sampling music for free) and eat it too (not paying musicians under the guise of "promotion" and keeping any revenue for themselves)."


    What are you talking about here? Sound Exchange collects ALL royalties from Internet radio as well as satellite and cable services like Music Choice, regardless of whether the songs that have been "broadcast" are by major or indie label artists. Pandora doesn't have a choice here...if they play a song, they pay royalties, period. That's why SX has that enormous list of artists that they can't "find." If you make and record music, you have to register with Sound Exchange to get paid for anything other than traditional radio airplay!


    Regardless of whether one likes or uses Pandora or Slack or even WOXY, it is the prohibitive royalty structure (supported by Sound Exchange) that threatens the future of Internet radio. If anybody is eating cake here, it's the greedheads at Sound Exchange and the RIAA...certainly not Pandora and, sadly, not the artists, who are usually left with the crumbs....

  • BigRicks

    I'll care, but mostly for nostalgic reasons, as I used to listen to it a few years ago and remember jotting down tunes that I liked on post-it notes and actually going out and purchasing some of the music I heard from Pandora. It's been sometime since I've used it regularly, mostly because the music tends to skew in all sorts of strange directions, but I'll miss it nonetheless.

  • Lucas Jensen

    @MTS: I respectfully disagree. Just introducing people to other artists, however within the boundaries of the listeners' taste they are, is challenging and provoking its audience in an era where nobody takes chances on anything. The act of agreeing to let someone else choose music for you (much like listening to college radio) is challenging in its own right. You have set the parameters with Pandora, much like you have by picking a radio station on the dial. And go to Pandora and type in "Nurse With Wound" or something similar and you'll get some challenging stuff if you want that.

  • Anonymous

    Pandora might not have been the best site in the world(and it is an epic failure apparently because it never strove to piss me off), but I used it and liked it. I found new bands, interesting songs by old bands and killed an awful lot of time at work. I fail to see how it being shut down could be anything but bad.

  • Anonymous

    I care. Your post improperly implies, BTW, that Pandora doesn't currently pay royalties. It does, and it has, from day one. And it's been paying the higher royalty rates since mid-2007. The founder, Tim Westergren, simply spoke up recently because it's been clear that SoundExchange has not been negotiating in good faith. Do the research: Pandora and its ilk pay higher royalty rates than satellite and conventional/terrestrial radio outlets. Pandora is not perfect, but with reasonable tweaking, you can get pretty darned good stations. I've got an adult alternative station for my wife that is awesome, blues and straight ahead jazz stations that are excellent, a traditional country station that is quite good. Can't quite seem to get a proper Chill station...I'd miss them.

  • Anonymous

    @Big Gray.: I guess it's good if it's working for other people. I know for sure that you and I probably have too much stuff to listen to as it is... P-)

  • jt.ramsay

    I can't wait to read the Muxtape post tomorrow.

  • MTS

    Pandora was elevator Muzak repackaged for the internet masses; never has it tried to provoke, challenge or offend its audience. The only aim of Pandora is to please, and that's why I could care less about the service biting the dust.

  • BenP

    About those royalty rate: They will rise to $.0019 in 2010. Let's do some math: Assume average song length is 3 minutes. In 15 minutes then, a listener would hear 5 songs and cost Pandora $0.0095 in music licensing costs. Not even a penny. Now multiply by a 1000 listeners - and Pandora's cost is $9.50. If they played 2 ads for 15 seconds every 15 minutes at a $10 CPM, then they'd have $10.50 in operating margin. But Pandora will complain - "we can't get a $10 CPM." Why not? Is it because they don't have a strong sales staff? Because that rate would be cheap for terrestrial radio or television. Is it because they can't prove the value of those ads to advertisers? If so, that is a grave problem - because if people aren't buying more music (all signs point to that) and people aren't buying the advertised product, then Pandora's not good at promoting anything. Except free, professionally produced content. I'm pretty sure Chrysler would be good at promoting free cars, if only those mean steel-manufacturers would stop charging so much for the raw materials.


    - from [audiobee.com]

  • silkyjumbo

    funny that you'd mention this. i just got an email from grooveshark, repping their new grooveshark autoplay:


    Start playing a song in Grooveshark Lite, click Autoplay, and we'll automatically start queuing up songs we think you'll like. Add a couple more songs to your queue, and the recommendations adapt on-the-fly to what you feel like listening to.


    wait, what?

  • Anonymous

    I am a swearer-by-pandora-er. I'm also one of the ones who has bought more music lately due to Pandora. I have heard bands that will *never* get traditional radio play, such as High On Fire and Dew Scented - good metal acts.

    Contrary to the statement, "I'm wary of sites like Pandora that seem to want to have their cake (creating technology that's all about sampling music for free) and eat it too (not paying musicians under the guise of "promotion" and keeping any revenue for themselves)", Pandora *does* pay royalty fees already and is willing to keep paying royalty fees. Nobody would be willing to pay 70%. Nobody. I am a subscriber to Pandora. I am paying $36/year - which is extremely cheap - $3 month for endless music.


    For those that complain about lack of variety, it could be that you are not providing feedback. That's what Pandora is all about - customized radio stations. I have about 10 different metal radio stations created on Pandora, each with different sounds, though there is some crossover. The radio stations I created were seeded with metal bands with different sounds, e.g., Mortician, Dethklok, Black Sabbath, Godflesh, etc.


    I constantly hear new stuff by using the Quickmix option, which shuffles the stations' play, but only the stations I include in the shuffle.


    I've tried last.fm and it is a far cry from Pandora. I prefer Pandora's simple interface, customizable stations, and an ever-growing stock of music.

  • Anonymous

    I've used Pandora in the past, and I know unsigned artists who have sold CDs to people who first heard their material on the site. For that reason alone it'll be sad to see it go.


    I'm actually a big fan of another internet music site - www.slacker.com - less obscure stuff but still super-customable...

  • DocStrange

    I use last.fm, I could hardly care (I don't even listen to last.fm's streamable content, I use a plugin for WinAMP and use it as a music tracker for what music I listen to in a given week, which is what a majority of last.fm users use it for).

  • Deadly Tango

    I couldn't ever get a properly chaotic mix out of Pandora -- it would get hung up on one or two outliers in my selectios and not come back to my intended effect despite using all my skips.


    But the issues being raised here are more complex than one company running out of cash. Webcasters are being handed a royalty rate based on unique play counts (songs X listeners) while satellite and cable ("Music Choice") and other non-AM/FM music sources get rates based on a percentage of revenue. And then there's SoundExchange speaking out of both sides of its mouth. SX is both the designated collections agent for the statutory royalties and the representative of specific members in negotiating those side deals that circumvent the law. It claims that artists matter but then argues for the statutory rates that are killing Pandora (and others) and leading to private deals with the labels that cut the artists out of the equation.


    Standing alone, Pandora's death doesn't mean much. The death of legitimate online streaming audio (of a non-Clear Channel variety) is a significant event for those companies and for music fans, artists, composers, and even the labels.

  • AquaLung

    @Big Gray.: Yeah, I don't use it but I know plenty of people who swear by it.


    If this thing does get shut down, I wouldn't be surprised to see some or all of the labels launch similar sites with their own music, cutting out the middle person.

  • Halfwit

    I agree with qyntellspitbull. I stopped using it for awhile once the "station" started becoming too static. Coming back to it, I cleaned a little house and decided to be more discriminating in what I "thumbs upped". Since then, I've found it to be terrific as far as introducing me to songs and artists that I might be interested in. Combined with emusic (or, for me, the Zune pass), Pandora has been an amazing resource.


    On another note... I was never able to get a stable stream out of Last.fm, a problem that I never had with Pandora.

  • Lucas Jensen

    Well, I know more non-music geek people out there that use Pandora than any other site out there. I hear from someone about once a week about how great Pandora is, and their numbers are pretty outstanding. I'm sorry, but any voices out there, particularly unique applications like theirs (and they listen to users and try to make it better), dying out is a bad thing in my book. It's numbers aren't far off from even Last.fm's, and what it's trying to do is quite admirable. I personally have heard from a number of people how much they like the iPhone application.


    People still like to have other people choose music for them.

  • MayhemintheHood

    I thought the idea was cool, but for me personally the site was never useful. Like Capnbecki said above, I would pass on most of the stuff it suggested was similar to a band I liked.

  • Anonymous

    I'm not sure how I feel about it, either. I just tried Pandora on my iPhone for the first time and while I did find a couple of artists that seemed somewhat interesting, nothing spectacular came of it. I ended up skipping most of the "suggestions" (they were all pretty boring) in favor of stuff I already liked - artists whose music I already owned anyway.

  • qyntellspitbull

    I care. Greatly. As someone who gets his music for free (as in work related, not torrent related), I have dropped more dimes on new music I discover via Pandora than any other source out there. It's been my gateway to personally discovering Jackson C. Frank to some less credible acts I'd rather not divulge here.


    Fine, I bought a Sicko record because I heard it on Pandora.


    Regardless, the site is a rare combination of technological smarts and musical obsession. I adore it.

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