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Thursday, November 15, 2012

Trade Review: Week Twelve (2/2)



In a united movement by chart topping artists and break out musicians alike, musicians are banding together to stop Pandora from lobbying to lower royalty rate payments to musicians on music streaming sites. Pandora is looking for Congress to cut its royalty rates and make music streaming royalty payouts be equal to terrestrial radio stations. In an earlier blog post, I opened up this topic to touch on the threat of music streaming gaining the same reputation, rights and recognition as standard radio stations. Now, artists are clashing with music streaming sights because music-streaming services want a larger cut in an artist’s musical content. These artists believe music streaming services are not even comparable to radio, music distributors or record stores, where royalty rates are less because these companies provide an actual service, and are simply a medium like YouTube that facilitates and permits unlimited, free music playing.
Moreover, some artists heavily rely on these music royalty rates despite the fact that payment are as low as $0.007 - $0.01 per stream. As a result, musicians are going a step further by “supporting a bill that would increase the royalty rates paid by radio and satellite companies” (Graziano). Not just to obtain a larger cut in royalties, but this is also a defensive, strategic ploy by the musicians to show Congress that not only is decreasing royalties wrong but the rates are already too low, unfair to musicians and the payout needs to actually increase. Musicians believe that music streaming companies need to “go back to the drawing board” and find a new way to derive revenue besides memberships and cheap advertisement spots (Graziano). Music streaming sights need to realize that artists could potentially decline to provide their content to these website, similar to what Taylor Swift and ACDC does. The musicians must be recognized as “the foundation of Internet Radio” and without new, creative content from musicians, the music streaming services will lose foot traffic, memberships and advertisement dollars.

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