http://www.thestandard.com./node/111808/comments comments feed. en The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com. The outlook for Pandora looks grim http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good <p> <p> </p> <p><img src="/sites/thestandard.com/files/u2482/pandoralogo.jpg" align="left" height="58" width="329" />Pandora, the excellent music recommendation and streaming service, may be closing its doors in the near future over royalty fees paid to SoundExchange, an organization that represents artists and record companies in royalty negotiations.</p> <p>Founder Tim Westergren <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">told the <span style="font-style: italic" class="Apple-style-span">Washington Post</span></a> the company was "approaching a pull-the-plug kind of decision." Pandora will pay roughly 70 percent of its projected revenue of $25 million in music royalties, a level which Westergren says is unsustainable. "We're funded by venture capital. They're not going to chase a company whose business model has been broken," he says.</p> <p>Because of the awkward regulations that were introduced as new forms of music delivery were developed -- first, terrestrial radio, then satellite, now Internet -- radio station owners <a href="http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html">pay different rates</a> depending on how the music is delivered. "Traditional" radio pays nothing in performance royalties, though SoundExchange is -- of course -- trying to change that. Satellite radio companies, for now limited to SiriusXM, pay around 6-7 percent of revenue: roughly 1.6 cents per hour per listener. Internet radio stations like Pandora are required to pay 2.91 cents per hour per listener -- a significant chunk of change for companies who, like so many Internet companies, haven't figured out a way to make much revenue.</p> <p>Congressman Howard L. Berman (D-CA) is trying to negotiate a last-minute deal to settle the issue, but is having trouble getting the parties any closer to a deal. As for Pandora's future? "We're losing money as it is," Westergren told the <span style="font-style: italic" class="Apple-style-span">Post</span>. "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." </p> <p>If that happens, Pandora's more than 1 million daily listeners will be left out in the cold -- and the company will be relegated to the dot-com scrap heap with every other popular-but-profitless Internet company from the past 10 years. </p> <p>At least they won't be lonely -- and will make a nice listing in <span style="font-style: italic" class="Apple-style-span">The Standard</span>'s "<a href="/search/all?t=Where%20are%20they%20now">Where are they now</a>" series.</p> <p><b>More news, commentary, and predictions from <i>The Industry Standard</i>:</b></p> <ul> <li>Prediction: <a href="/predictions/pandora-avoids-bankruptcy-quickly-converts-subscription-model"><b><span class="load-local" style="position: relative">Pandora avoids bankruptcy, quickly converts to subscription model</span></b></a></li> <li>Special Feature: <b><a href="/news/2008/06/24/what-your-future-really-looks-digital-home-2013">The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/29/where-are-they-now">Where are they now? <i>The Industry Standard</i> tracks down 10 dot-coms from the Web bubble of the late 1990s</a></b></li> <li>Special Feature: <b><a href="/news/2008/05/14/industry-standards-top-25-b-z-list-blogs">The Industry Standard's Top 25 B-to-Z List Blogs</a></b></li> </ul> <p> </p> http://www.thestandard.com./news/2008/08/18/pandora-about-die-it-sure-doesnt-look-good#comments co:Pandora Online Music Standards & Legal The Industry Standard Mon, 18 Aug 2008 02:19:48 -0700 Jordan Golson 111808 at http://www.thestandard.com.