And you thought Sony BMG had already wrapped up the Music Industry Dunce of the Week Award....
Yes, it beggars belief, but today the PPL (which represents the record labels) and the MCPS/PRS Alliance (which represents music publishers) have somehow managed to snatch the prize for actions which are far more reckless, self damaging and downright tight-fisted long term than BMG's daft attempt to package MP3s.
In one of the most poignant and logical letters I have had the pleasure to read at TrustedReviews, Tim Westergren - founder of Pandora, the brilliant, free, 'intelligent' Internet streaming radio station - explained that it will close the service to all UK users on 15 January due to impossibly high new licensing rights demanded from the PPL and the MCPS/PRS Alliance.
If you'll excuse the long quote, I think Tim explains the scenario best:
hi, it's Tim,
This is an email I hoped I would never have to send.
As you probably know, in July of 2007 we had to block usage of Pandora outside the US because of the lack of a viable license structure for Internet radio streaming in other countries. It was a terrible day. We did however hold out some hope that a solution might exist for the UK, so we left it unblocked as we worked diligently with the rights organizations to negotiate an economically workable license fee. After over a year of trying, this has proved impossible. Both the PPL (which represents the record labels) and the MCPS/PRS Alliance (which represents music publishers) have demanded per track performance minima rates which are far too high to allow ad supported radio to operate and so, hugely disappointing and depressing to us as it is, we have to block the last territory outside of the US.
It continues to astound me and the rest of the team here that the industry is not working more constructively to support the growth of services that introduce listeners to new music and that are totally supportive of paying fair royalties to the creators of music. I don't often say such things, but the course being charted by the labels and publishers and their representative organizations is nothing short of disastrous for artists whom they purport to represent - and by that I mean both well known and indie artists. The only consequence of failing to support companies like Pandora that are attempting to build a sustainable radio business for the future will be the continued explosion of piracy, the continued constriction of opportunities for working musicians, and a worsening drought of new music for fans. As a former working musician myself, I find it very troubling.
We have been told to sign these totally unworkable license rates or switch off, non-negotiable...so that is what we are doing. Streaming illegally is just not in our DNA, and we have to take the threats of legal action seriously. Lest you think this is solely an international problem, you should know that we are also fighting for our survival here in the US, in the face of a crushing increase in web radio royalty rates, which if left unchanged, would mean the end of Pandora...
...Pandora will stop streaming to the UK as of January 15th, 2008.
Again, on behalf of all of us at Pandora, I'm very, very sorry.
So from the stupidest quote of the week to the smartest. Of course this news also expands beyond Pandora to any streaming music station so it looks like we'll have to brace ourselves for more closures soon.
Wealthy, short-sighted and stubborn. It's funny how many characteristics the record industry shares with Mr Magoo...
Ma quanto aveva chiesto a Pandora l'abbinata PPL & MCPS/PRS Alliance? Alla domanda risponde James Cridland sul suo blog. Con una logica stringente e delle cifre che parlano da sole.
A few days ago, I posted the news that Pandora is closing in the UK. Part of the reasons given were…Insomma a conti fatti l'industria radiofonica commerciale britannica raccoglie in pubblicità (non necessariamente radiofonica, conta anche quella su Internet) per ogni suo ascoltatore circa 2 pence e mezzo all'ora. L'industria musicale pretenderebbe di ricevere da Pandora 2,11 pence. Se dovessimo equiparare Pandora a una stazione radio (e perché non dovremmo farlo?), Pandora metterebbe in cassa, nel migliore dei casi 2,57 pence ma ne dovrebbe versare 2,11 alle case discografiche per lo streaming della sua musica verso il pubblico online di Albione. Se mi avete letto fin qui abbiate la pazienza di andare sul sito di James per i commenti. Il primo di questi commenti è proprio di TIm Westergren, di Pandora. A me sembra molto sensato:
Both the PPL (which represents the record labels) and the MCPS/PRS Alliance (which represents music publishers) have demanded per track performance minima rates which are far too high to allow ad supported radio to operate
Well, so Pandora say. But they’re just saying that, aren’t they… of course they’ll claim the figures are “far too high”. That’s part of standard negotiation. Right?
Well, let’s do a little maths. Paidcontent.co.uk reports that MCPS/PRS was asking for 0.085p per song per listener. PPL, in a press release about the Pandora closure, says they would charge 0.0561p per song per listener. Pandora plays around 15 songs per hour.
MCPS/PRS: 15 x 0.085p = 1.275p per listener, per hour
+ PPL: 15 x 0.0561p = 0.84p per listener, per hour
Total music rights payments: 2.11p per listener, per hour.
Now, consider this.
The latest figures from the UK’s Radio Advertising Bureau says that the commercial radio sector as a whole brought in £593m in 2007. The latest RAJAR figures show that commercial radio is listened-to for 441m total hours every week, or alternatively 23,018m total hours a year.
So… 23,018m total hours brings in £593m. Divide one by the other, and we find that, as a total industry average, commercial radio makes 2.57p per listener, per hour. And the revenue figures also include non-radio activity, like websites.
- The entire commercial radio industry in the UK, after 35 years experience and with 31 million weekly listeners, far outstripping even Google’s online reach, makes 2.57p per listener, per hour.
- For online radio, the UK music industry want rates that are 2.11p per listener, per hour.
Pandora would still have to pay their staff and their streaming costs; but once the music industry have taken 82% of their revenue, it’s a bit hard to understand where they’d find the money…
So, in short, it would clearly appear that these rates really are “far too high to allow ad supported radio to operate”.
There’s a bad thing being done here to artists - it’s like a kid taking his ball and going home, only that ball really belongs to a lot of other people (artists). Artists have the right to charge what they want… but does anyone believe this position reflects the interests of artists? My hope is that the artist community will really start to rise up and demand proper representation. This is a disaster for them, especially the 99% of musicians who aren’t getting played on the few radios that operate. We’re being inundated with emails from depressed listeners who’ve said that Pandora has re-ignited their passion for music and has driven them to discover lots of new artists and buy their music, and see them play live. I spent 10 years as a working musician - I’m the first one to insist on paying artists - but that needs to be done in a balanced way that allows these new, democratic, inclusive online services to grow. It’s a win-win.Tim, che per dieci anni è stato musicista, dice in pratica ai suoi ex colleghi: ovviamente avete diritto di farvi pagare quello che volete, ma state attenti a chi vi rappresenta nella tutela dei vostri "diritti". A drizzare le orecchie, sostiene Westergren, sono soprattutto i musicisti (la vasta maggioranza) che non vengono mai trasmessi dalle radio (che già non sono moltissime). Pandora, aggiunge il suo fondatore, ha contribuito a far conoscere nomi di cantanti e complessi del tutto ignoti e ora molta gente esce di casa per comprare i loro dischi e andare ai loro concerti.
Alla fine tutta questa faccenda dei diritti musicali, del rimpiattino tra acquisto e pirateria, della questione DRM sì o no, ricorda molto il dibattito sui prezzi della verdura. L'assurda sperequazione che vede il coltivatore che incassa 1 per il suo pomodoro, la rete di distribuzione che ne incassa 59, il negoziante che incassa 99 e noi che paghiamo 100. E' un sistema che non può funzionare alla lunga (a parte la non trascurabile faccenda dell'agricoltura che per forza, con questi prezzi, deve essere sussidiata coi soldi dei contribuenti ma che ci spinge a chiedere: il sussidio, in che tasche finisce?). Prima o poi contadini e massaie si ribellano. Esattamente come stanno facendo gli appassionati di musica.