Pandora stiffing songwriters

The music business has changed a great deal since I started out more than 40 years ago. With the recent launch of Apple’s iTunes Radio and continued popularity of Pandora’s online radio, it’s poised for another monumental shift, as online streaming becomes the preferred method of listening to music.

As a songwriter, I am excited by the amazing opportunities technology is now creating to allow more music to reach new audiences. But I’m also deeply concerned about what the shift toward streaming could mean for my fellow songwriters, especially those just starting out.

{mosads}Most songwriters are already struggling in the digital economy to eke out a living. And Pandora Media Inc., which now controls roughly 70 percent of the U.S. streaming market, is engaged in an aggressive effort to reduce the already low rate it pays songwriters for the right to stream their music. If Pandora prevails, it will become nearly impossible for the average songwriter to make a viable living from his or her work. And that should trouble anyone who cares about the future of music, whether you’re a music professional or a fan.

There are hundreds of thousands of songwriters, composers and lyricists working in the United States today, some successful and some aspiring. You won’t recognize most of their names, but they are the foundation of the entire music ecosystem.

The primary source of income for American songwriters is the royalties we earn when our songs are performed at live shows, broadcast or streamed on any platform. Unlike recording artists, who can supplement their income by going on tour and selling T-shirts, songwriters depend on these “public performance” royalties to make ends meet. Most American songwriters belong to a performance rights organization, like The American Society of Composers, Authors and Publishers (ASCAP) or Broadcast Music Inc., to make sure we’re paid fairly when businesses use our music.

But Pandora, a publicly traded company that’s generated revenue above $288 million in the first half of this year alone, claims “unreasonable” licensing fees are standing in the way of the company’s growth. And the company is going to great lengths to lower the payments it owes songwriters, even filing a lawsuit against ASCAP in federal rate court last fall.

The problem is that Pandora’s argument doesn’t quite match with reality.

Even compared to other music streaming companies, Pandora is actually paying songwriters very little. In fact, every 1,000 plays of a song on Pandora is only worth about 8 cents to songwriters, composers and music publishers. In all, Pandora pays songwriters only about 4 percent of its revenue for the right to stream tens of millions of songs hundreds of millions of times.

And yet, Pandora is spending millions of dollars in legal fees trying to pay songwriters even less.

Fortunately, Pandora’s new CEO, Brian McAndrews, now has an opportunity to set things right. That is a message fellow songwriters and I will be taking to Capitol Hill this week. Songwriters want Pandora to succeed, just like we want all new entrants into the music space to succeed. When they pay fairly, these services have the potential to open up exciting new opportunities for songwriters and make a big difference in their careers.

Instead of fighting to pay music creators less than a fair market rate, McAndrews should join us in building a sustainable future for music with licensing deals that allow songwriters and composers to thrive alongside the businesses that revolve around our work.

In doing this, Pandora’s new CEO would demonstrate the company really does “believe in the value of music and have a profound respect for those who create it,” as its website proudly claims. Until then, however, Pandora’s actions send a clear message that the interests of its Wall Street shareholders are worth far more than the rights of the individuals who write and compose the songs that make its business — and the rest of us — sing.

Williams is an Oscar, Grammy and Golden Globe-winning Hall of Fame songwriter and the president and chairman of the board of ASCAP.