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Pandora Paid Over $1,300 for 1 Million Plays

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Re: Pandora Paid Over $1,300 for 1 Million Plays

#71

Post by hexis »

On some days, I wish companies like Pandora, Spotify, and Rdio would just voluntarily shut down. If the music industry thinks streaming companies are ripping them off, the music industry is welcome to build their own streaming business and show everyone how it's done.

Musicians were complaining about royalties and payment long before the internet was invented and they'll be complaining long after we're all gone. Keep that in mind when they act like streaming is the new scourge of music.

Re: Pandora Paid Over $1,300 for 1 Million Plays

#72

Post by endersshadow »

gizmo686 wrote: post #66
smacktoward wrote: post #25

Earlier quoted context omitted.

> I don't know what exactly the cost of running a Pandora company means financially Well, Pandora is a public company, so they have to disclose all that stuff. Which means we can look it up! Transparency is awesome. According to their latest annual report ( http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9M... ), in fiscal 2012 Pandora brought in $274 million on $285 million in operational expenses. Of thos…

At risk of sounding stupid, $274-$285<$0. How does that work?

How does a company lose money? They didn't start from nothing--they have money in the bank from equity infusions (e.g.-going public). You lose money if you make less than you spend. That's what happened here.

Edit: Also, these numbers aren't just cash. Revenue is realized when it's earned, not when it's actually paid. So, for example, if Pandora provides $50MM of advertising, and then bills that, it records $50MM of revenue, even if it hasn't received all of that yet. Instead of being counted in cash, it's counted in accounts receivable (commonly abbreviated as A/R). This adheres to GAAP (in the US).

Re: Pandora Paid Over $1,300 for 1 Million Plays

#73

Post by thijsc »

hexis wrote: post #71

On some days, I wish companies like Pandora, Spotify, and Rdio would just voluntarily shut down. If the music industry thinks streaming companies are ripping them off, the music industry is welcome to build their own streaming business and show everyone how it's done. Musicians were complaining about royalties and payment long before the internet was invented and they'll be complaining long after we're all gone. Keep…

Spotify is owned partially by the music industry: http://www.guardian.co.uk/music/musicblog/2009/aug/17/major-...

I'm sure the labels are very happy to keep making the same margins they used to with these new distribution channels. The music industry is doing fine here, it's just the artists who are getting a small piece of the pie.

Re: Pandora Paid Over $1,300 for 1 Million Plays

#74

Post by nedwin »

Afforess wrote: post #5

Its easy to complain about the low pandora royalties, but these artists are essentially trying to kill the golden goose. Pandora currently spends > 50% of revenue on royalties. Any increases would almost certainly lead to the end of the company. $0 is a lot less than $1,300 for 1 million plays.

Spare a thought for Spotify - they are contractually obliged to pay out in excess of 70% of their revenues to the record labels.

Re: Pandora Paid Over $1,300 for 1 Million Plays

#75

Post by crocowhile »

I don't quite get the point of this. The original article already said what it had to be said:

For frame of reference compare Sirius XM paid me $181.00 Terrestrial (FM/AM) radio US paid me $1,522.00

All the artist cares about is how much it gets at the end of the day.

Re: Pandora Paid Over $1,300 for 1 Million Plays

#76

Post by aston »

winterchil wrote: post #63
aston wrote: post #49

If I told you there was an e-commerce company without a profitable year in over a decade of existence despite federally-mandated price ceilings placed on their suppliers, you'd be incredulous. If I then added that the same company was lobbying in Washington to get the price ceiling lowered, the pitchforks would be out. But then mention it's a company selling music, and people shrug, "Oh, well music should be free any…

Not if the price ceiling were selectively enforced against only one type of radio station. In your analogy this would be the e-commerce company has to buy twinkies from their supplier at 8x the price everyone else pays by government mandate.

Why's the price matter? Any store that buys merchandise it can't sell at a profit is making a basic business mistake.

Separately, to your point about unfairness, I suspect that both radio and internet streaming prices are lower than what the market would set if the government didn't intervene.

Re: Pandora Paid Over $1,300 for 1 Million Plays

#77

Post by hohead »

jcampbell1 wrote: post #27

This makes sense. Another way to back into the figure: Pandora spent $82M on content according to the most recent 10Q, with 4.18B listener hours. That implies a cost of $0.02 cents per listener hour. A million plays is roughly 62500 listener hours, which implies a content cost of $1250.

Interesting analysis.

Based on their cost of $0.02 cents per listener hour, I wanted to calculate how many hours per day my $36 yearly payment equates to (ignoring their operational costs):

($36 / $0.02) = 1800 hours per year

1800 hours per year = 4.93 hours per day

Re: Pandora Paid Over $1,300 for 1 Million Plays

#78

Post by ThomPete »

I have said it before and I will say it again.

20 years ago that and thousands of others songs wouldn't even have been played anywhere and definitely not a million times.

If you want to live off of making music or as an author or anything else you have to think like a publisher not an artist.

Playing music is a joy, something you can enjoy whether you make money or not from it.

Living from making music is an opportunity not a right.

Re: Pandora Paid Over $1,300 for 1 Million Plays

#80

Post by chockablock »

crocowhile wrote: post #75

I don't quite get the point of this. The original article already said what it had to be said: For frame of reference compare Sirius XM paid me $181.00 Terrestrial (FM/AM) radio US paid me $1,522.00 All the artist cares about is how much it gets at the end of the day.

Please actually read TFA: artists get performance royalties from pandora, but not from terrestrial radio, but these were not included in the $16.89. Also, terrestrial radio plays likely reached many many more listeners than pandora did.
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