Pandora is having some serious troubles. It seems to most like they should be making money with the constant advertising interrupting their music selection, but with the current and outdated copyright laws, they’re hemorrhaging cash.
At $.99 a song, music is cheap…For one individual. But imagine buying thousands of songs for millions of unpaying customers? Welcome to the world of bullshit copyright math.
Now, Pandora doesn’t have to pay quite that much per song per person, but the current laws require them to pay out huge royalty fees demanded by record companies.
That means that the small sum they earn from paid customers and advertising simply can’t cover the costs. The music companies charge enormous fees, and it’s legal.
Another issue? Yep. They’re losing a ton of money to Spotify and other new services. There’s literally nothing they can do. So how will they survive? They’re reaching out to the US government to change aging copyright laws. They are lobbying for the exact opposite of what content providers lobbied for last year (SOPA). Unfortunately it’s unlikely that they will succeed.
Why is it unfortunate? Less stringent copyright laws would mean more high quality content on the web, and savings for consumers. IF the government could cut down royalties, more small production companies could use better music, music would be cheaper to purchase, and Pandora could stay afloat. But that’s not going to happen with millions of dollars being spent to keep progress at a standstill by major corporations. Pandora might as well give up now.
Much larger companies (i.e Google) have fought and lost in this area. The sad truth is that only a rebellion of the people, and a mass of people contacting their representatives could actually reverse this trends. We are resigned for now, and likely years to come to accept the outdated copyright system (and if the media corps have their way, we will see even tighter restrictions).