Check out Pandora's new office space

They don't sell songs, they sell advertising same as Facebook and YouTube.  That's where the money is anyway and that's also why these sites don't want copyright laws and lobby against them.  They are using the work of others to make themselves rich.  I ask my daughters friends when they come over how they listen to music these days.  Their answer?  YouTube.  Everytime.  It's free.  Why would they pay??  And here's the big thing, why would YouTube ever want to enforce copyright laws when the use of music attracts so much traffic to their site?  

Exactly, they wouldn't, nor ever will. 

Help me understand this. All these sites can just take anybody's music and
just post it to their site, without anybody's permission, as long
as they throw a few pennies their way.

Here's the short complicated answer to that.

Pandora, Spotify and other streaming companies made deals with the Performing Rights Organizations based on outdated internet laws that haven't been updated since - I believe the mid 2000's. If you will recall, the iphone didn't come out until 2007...so, streaming media wasn't even a thought when these digital rights laws were being formed.

The PRO's were forced to make deals with these streaming companies based on prior deals made with terrestrial radio...which is based on copyright legislation from 1941. The way that works is very basically like this. A song gets played at 8PM on a country station in Dallas TX. That radio station has a certain number of "impressions" or listeners for that time and in that population center. Lets just say that station is judged to reach 100,000 impressions. So - that one spin would equal 100,000 impressions. The PRO's and radio (that uses music to sell advertising) agreed to what each impression should cost. Imagine that over the 30 week period that it takes to get to No.1, the song averages 500 spins per day and 25,000 impressions per spin. Lets just say the rate is .0003 cents per impression. That's $3750 per day. Multiply that times 210 days and that's around $787500 to be split by publishers and writers and that's actually a really high guestimate...But that's just to give you an example of what and how radio pays.

Now STREAMING sites want one impression to equal one stream. Even though this rate was agreed on for a totally different purpose. Even though people seeking out a song for free on an internet site is different than waiting by the radio and hoping you hear your favorite song.
This rate SUPPOSEDLY equals out to somewhere around .003 to .008 cents per stream. HOWEVER - I can tell you that on one of my recent ASCAP statements (the last one I could stomach to look at) I made a little less than $3 for nearly 40,000 plays of my songs. Now, by my math, 40,000 x .003 = $120. I got almost $3. So - in reality, I got around .000078 cents per stream. Lady Antebellum’s 2011 Grammy-winning Song of the Year “Need You Now” was streamed nearly 72 million times on Pandora, earning its four songwriters and publishers $5,918.28. Co-writer Josh Kear received only $1,479.57.

Here's an excellent link from ASCAP that puts things into perspective...
www.ascap.com/playback/2013/06/action/pandora-buys-fm-radio-station-in-a-bid-to-undercut-songwriters.aspx


So - right now, there is a bill before Congress - beta.congress.gov/bill/113th-congress/house-bill/4079 - the Songwriter's Equity Act. Right now, the Performing Rights Organizations (ASCAP, BMI, SESAC) can't negotiate different rates or deny licenses with the individual companies (Spotify, Pandora, etc.) BECAUSE of outdated copyright legislation. This act would allow the PRO's to make a deal with Spotify and a separate deal with Pandora. Right now, because they can't, SONY and Universal have threatened to pull all of their songs out of the PRO's control and make deals themselves. (For some reason they are allowed to negotiate deals and deny licenses). If that happens, the songwriter has ZERO REPRESENTATION. That's like letting Saddam Hussein run the Catholic treasury.



I think that internet streaming should be more valued than radio. The user has intentionally picked out a "station" with a specific genre or style - even down to identifying the artist the listener wants to hear. All for free, mind you. To me, the listen is more valuable than just a radio blaring down a hallway that reaches the ears of 25 people. They have no "qualifier" of how many people are listening at once...Why not?? Not everyone is listening on their ear buds. Ever heard of speakers?

Hey why pay for the one thing you need to make your buisness model work?

I'm not sure it's ok to just say, "oh well...it didn't work out..." People fought for this for the last 80 years...and I have to say, I don't think the songwriter has EVER been fairly compensated. If this was ANY other business, people would be up in arms. I am all for free markets and capitalism, but not absolute un-fettered, take advantage of someone else to make your billion capitalism.

Not nearly as badly. They have a screen writer/actors guild that has influence with lawmakers. Copyright issues are starting to effect the film industry, and once they get pissed off, something will be done.

They make huge profits off of the backs of others... what's more American than that?

Last I checked the large majority of American workers - since the 1940's - are compensated fairly for their work. And that's because of unions (most of those have priced themselves out of the market) and legislation. I don't expect a ridiculous wage - but I do think it's AMERICAN - to pay a fair one.