Earlier this year, Pandora bought South Dakota FM-radio station KXMZ-FM in an effort to keep its royalty commitments down by qualifying for an ‘RMLC’ licence, which covers companies with traditional and digital radio services (Bulletin, 12-Jun-13). Licensing body ASCAP wasn’t happy at all, and now it’s filed a complaint with the US Federal Communications Commission (FCC) to try to block Pandora’s strategy. “Pandora’s acquisition of KXMZ would not serve the public interest,” claims ASCAP. “Pandora’s public statements lay bare its plot: to use KXMZ as a bargaining chip in Pandora’s quest to obtain lower royalty rates for its online music streams.” The filing also claims that Pandora hasn’t met FCC rules on disclosing its ownership. “Pandora is acquiring KXMZ for use as a bargaining chip in its ongoing dispute with ASCAP over performance royalty rates, not because Pandora wishes to undertake an ‘obligation to provide programming responsive to the needs and interests of the residents’ of Box Elder, South Dakota, the Station’s community of license.” One the one hand, ASCAP is right about the public statements, but on the other, Pandora has also talked about plans to use its data on local listening habits when planning the station’s playlists, so it has a strong case on the ‘responsive programming’ point.

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