ASCAP, Pandora await verdict in court battle over digital music rights
By Josh Peterson | Watchdog.org
A feud over music royalties between a major publisher and a popular Internet radio service could end in the coming weeks.
A MAJOR DECISION: An trial over music royalties could change music royalty rates.
Pandora Internet Radio and the American Society of Composers, Authors and Publishers gave closing arguments at the beginning of last week in a trial industry watchers are convinced could change music royalty rates.
Pandora is seeking the ability to pay the same rates to play music as traditional radio stations broadcast over the airwaves, which is 1.7 percent of revenue; ASCAP, one of the industry’s leading music publishers, is fighting that quest.
Judge Denise L. Cote of U.S. District Court of Manhattan is expected to announce her verdict in the coming weeks.
Cote, during Pandora’s closing arguments, said she agreed with Pandora’s argument that “Pandora is radio.”
Cote already handed Pandora a victory in September 2013, when she said ASCAP must make all of its songs available for Pandora to license through 2015.
ASCAP is hoping to have Pandora classified as a “music service” and seeking up to 3 percent of Pandora’s revenues to play ASCAP licensed music.
The music publisher, while claiming to protect the rights and paychecks of artists, is often viewed by small businesses as a bully.
Over the years, the organization has used lawsuits to intimidate restaurant and bar owners, YouTubers and even Girl Scouts into paying high license fees for playing copyrighted music in public.
At the same time, music industry power players sit on the board of the organization, which declared an operating budget of more than $100 million in 2012.
By comparison, the Motion Picture Association of America and the Recording Industry Association of America declared in 2010 operating budgets of about $48 million and $27 million, respectively.
Pandora didn’t do itself any favors in the musical community when it backed legislation in the nation’s capital aiming to require services such Pandora to pay the same royalty rates as cable and satellite providers.
In July 2013, the company — previously hailed as a promising musical promotion outlet for less-known artists — was accused by reknown groups such as Pink Floyd of wanting to “slash musician’s royalties.”
The company abandoned the effort in late 2013 when it decided to focus on lobbying the Copyright Royalty Board.
The CRB is a three-judge panel in charge of establishing royalty rates for Pandora and similar services.
ASCAP did not return Watchdog.org’s multiple requests for comment. Pandora declined Watchdog.org’s request for comment.
Contact Josh Peterson at jpeterson@watchdog.org. Follow Josh on Twitter at @jdpeterson
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