Court decision a setback for Pandora

January 2014

Internet, music publishing


A court ruling in the US yesterday will potentially cause problems for leading American streaming service Pandora, after it was ruled that some key music publishers can withdraw their catalogues from the licence provided to the digital firm by collecting society BMI.

As previously reported, Pandora is wholly licensed in the US via the collective licensing system. On the recordings side, in America the record companies are obliged by law to license Pandora-style set-ups collectively, and do so via SoundExchange.

The publishers initially voluntarily opted to license Pandora et al via their collecting societies ASCAP and BMI. But in the last year or so some of the big publishers have started to look to licence more digital services directly, believing they can negotiate more favourable terms that way, and remove the restrictions that come with collective licensing deals.

In a similar squabble with BMI the court has ruled in favour of the society, mainly because of the timing and wording of the most recent agreement between Pandora and the rights group, which – a judge confirmed this week – allowed for alterations in catalogue, foreseeing that the big publishers were moving toward direct licensing in the digital domain.

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