Pandora CEO Joe Kennedy told Congress today, in no uncertain terms, that his business is in danger from high copyright royalty rates. But his plea fell on unsympathetic ears.
At a hearing before the House Judiciary Committee, key representatives were not only unmoved by Pandora, they were more interested in raising the royalties paid by terrestrial radio to musicians (radio currently doesn't pay royalties at all.)
Pandora, by contrast, pays about half its revenue in copyright royalties. Today, Kennedy compared those fees to satellite radio, which pays about 7.5 percent of its revenue, and cable radio, which pays 15 percent.
"The rates today in Internet radio prevent anyone from entering the market, or for those there, making any profit in the market," said Kennedy. [...]
Rep. Watt said that the "longstanding inequity" in rates that Pandora was complaining about ignored the fact that "an even longer-standing inequity exists, in that US copyright law fails to recognize a performance right for vocal artists and musicians when their music is played over FM and AM radio."
In other words:
Pandora: "Change our rates to be in the same order of magnitude of what 'real' radio gets away with!"
Congress: "Actually we're more interested in putting radio out of business too."
Which is no great loss, I guess, but the stupid it burns.