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Pandora On the Verge of Closing Shop

Written by Corvida / August 16, 2008 5:34 PM / 105 Comments

Pandora is an internet radio service that allows you to create your own radio station based on songs and artists that you like. While you can't necessarily pick and choose what you'll hear on the service, you can fine-tune your radio station's tastes by giving the songs that Pandora recommends a thumbs up or a thumbs down. Pandora on the iPhone is one of the best applications for streaming music and finding new tunes. So, what will the service's 1 million plus users do if Pandora pulls its own plug?

The Battle of Music

Founder Tim Westergren has stated that the service is approaching a "pull-the-plug kind of decision" for the service. Why is this happening? Last year, web radio giants were hit with outrageously ridiculous fees by a federal panel for every song that would be played on their stations. This caused a lot of services to either shutdown, or go through what Pandora has been experiencing for the past year. In doing so, it seems the financial problems the music industry has set out to create in order to win the constant battle between rights, piracy, and copyrighted music, are working.

Last Stand, Last Chance

Pandora's founder is waiting for a ray of light in a fight being led by Rep. Howard L. Berman (D-Calif.). Berman is attempting to arrange a few last-minute deals between web radio stations and SoundExchange, the organization that represents artists and record companies that would reduce the the recent fees. However, Westergren isn't going to hold his breath for too long, stating that, "The moment we think this problem in Washington is not going to get solved, we have to pull the plug because all we're doing is wasting money." We don't blame you Tim.

What Will You Do?

There are plenty of petitions floating around the web to help the cause, but the law is the law and petitions may not help matters in this situation. We'd be saddened to see Pandora close its doors. While services like Last.FM aren't showing any of the same signs, we wonder if the same fate may be in the not-so-distant future for our other favorite music services. If it is, what will you do?

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  1. This sucks
    Whilst I don't use Pandora and only infrequently last.fm, I am saddened that the music industry* are hell bent on controlling their revenue streams in such a largely "industrial age" manner.

    But, it's their choice.

    I can only hope that the constant battles they are having with the people that want to listen to music from artists (which doesn't have to involve the record industry) will be resolved for the benefit of artists and music lovers. If the music industry dies because of that .. ho hum.

    * music industry is only a few major conglomerates really, isn't it?

    Posted by: Mike Riversdale Posted on FriendFeed   | August 16, 2008 6:35 PM



  2. so sad. I'm a last.fm fan, but, this is absurd.

    Posted by: Karl Posted on FriendFeed   | August 16, 2008 6:52 PM



  3. This is really unfortunate. I enjoy the Pandora app and the Music Genome Project. It will be very sad to see them go if that is the case.

    Posted by: Erik Reagan | August 16, 2008 6:58 PM



  4. Dear music fans, we hate you. Please quit purchasing our content because we hold you in complete contempt. Love and kisses, the Recording Industry and all artists with labels that are members of the RIAA.

    Posted by: Tad Donaghe Posted on FriendFeed   | August 16, 2008 7:00 PM



  5. I can't wait til the whole thing goes under and they don't make a red cent on recorded music. Look at China, and you'll see where they are pushing the rest of the world.

    Posted by: Cyndy Posted on FriendFeed   | August 16, 2008 7:06 PM



  6. Pandora is ok, but I prefer Finetune, GrooveShark, Imeem, and even newbie MixTurtle, because I can listen to the music that I want to hear. I'm pretty much through with radio.

    Posted by: loli | August 16, 2008 7:07 PM



  7. Dear RIAA, Ok, if you say so.... We'll just bittorrent it instead.

    Posted by: Jason Carreira Posted on FriendFeed   | August 16, 2008 7:07 PM



  8. Jason, I wonder who that's really punishing though. The RIAA, the record label, or the artist?

    Posted by: Akiva Moskovitz Posted on FriendFeed   | August 16, 2008 7:08 PM



  9. I'm losing my patience w/ the record industry. the choice is obvious.

    Posted by: rambn | August 16, 2008 7:10 PM



  10. uh, bittorrent?

    Posted by: rambn Posted on FriendFeed   | August 16, 2008 7:10 PM



  11. Akiva, in most cases, the label, which essentially is the RIAA. Most of the money from sales (and punishments for torrenting) goes to the label/RIAA. What galls me is that they approach everyone like they are criminals, even those of us who spend a small fortune on music.

    Posted by: Cyndy Posted on FriendFeed   | August 16, 2008 7:13 PM



  12. Pity - love the Music Genome Project to trawl for information

    Posted by: viki saigal Posted on FriendFeed   | August 16, 2008 7:14 PM



  13. I'm a long time Pandora listener, and am really sorry to hear things are going this way for Tim and the Pandora crew.

    This service has been 100% awesome the entire time I've used it, and have had many friends be grateful that I introduced them to Pandora.

    I subscribed to Sirius for several years, and just recently canceled my service because of the Pandora iPhone app...and because Pandora's personalized stations are simply unbeatable.

    What can we, as a listener base 1 million strong, do to help Tim?

    Posted by: Shay Frendt Posted on FriendFeed   | August 16, 2008 7:31 PM



  14. Jason, nobody said anything about bittorrent. Ixnay ethay ittorentbay alktay.

    Posted by: Pete Delucchi Posted on FriendFeed   | August 16, 2008 7:37 PM



  15. suckssszz!
    i'm def/ clicking their ads now

    Posted by: Simon | August 16, 2008 7:54 PM



  16. i like last.fm much more. survival of the fittest.

    Posted by: buster | August 16, 2008 7:56 PM



  17. Wow. I have actually BOUGHT music because of Pandora...music that I wouldn't have known about otherwise. Why can't the record industry understand that they should be working with these services rather than against?

    Posted by: chris | August 16, 2008 7:57 PM



  18. Uhh... ok... make that mix tapes.... we're going to make mix tapes and send them around the world ;)

    Posted by: Jason Carreira Posted on FriendFeed   | August 16, 2008 8:03 PM



  19. Support indie artists

    Posted by: Will Diehl | August 16, 2008 8:04 PM



  20. wah, wah, wah, i don't feel sorry for them at all b/c if they had it their way they wouldn't pay artists a penny so they could get rich from ads. how jacked up is that

    Posted by: Fred | August 16, 2008 8:38 PM



  21. This is just Atlas Shrugged with music and tech instead of steel and railroads.

    Posted by: doug | August 16, 2008 8:53 PM



  22. I would have to quit listening to anything but independent music. I can't afford the prices CDs cost, and I'm not about to spend a dollar per song.

    Posted by: MKR | August 16, 2008 8:54 PM



  23. What happens to the music Genome thing...the core engine/algorithm for pandora...does it die with closing of pandora or will it be released into the 'open'?

    there is jamendo, we7, magnatunes. lots more...and pandora is already US only, so for us asians, they've pulled the plug years back.

    Posted by: Diabolic Preacher | August 16, 2008 9:07 PM



  24. @Jason Carreira (jasoncarreira): And we're going to use, uh, distributed P2P algorithms without a name to do it!

    Posted by: Alexander Williams Posted on FriendFeed   | August 16, 2008 9:36 PM



  25. And Germany isn't far behind China... http://rss.slashdot.org/~r/Slashdot/slashdot/~3/365817172/article.pl

    Posted by: Cyndy Posted on FriendFeed   | August 16, 2008 9:40 PM



  26. I hate to be the voice of dissent but they've been saying they're about to go under for at least a year. It's partly their own fault though. They refuse to consider any options apart from getting the record industry to see reason. That's why they're 'doomed' but last.fm is thriving.

    Posted by: Adewale Oshineye Posted on FriendFeed   | August 16, 2008 11:15 PM



  27. I find the whole situation in the music industry completely absurd. I am in the middle of this fiasco as a music management company and label owner. This is ridiculous that Pandora are required to pay the performance and songwriter's royalties when radio station have been excluded from paying performance royalties for like 50+ years. And only now have they begun to chase after radio stations to pay the performance fee. Albeit to save face and not look like the bullies they are.

    This is about Control. They screwed it up 10 years ago when we drug their asses kicking and screaming into the Internet. Now every time someone invents something to bring the music to the masses the major labels start crying foul because they lose control of something that they had on lock. Now that distribution has been yanked out of their bratty selfish hands they want to start making small internet radio stations pay extortionist fees at the hands of the FCC ruling instead of a percentage of profits. Did somebody ask the RIAA what happened to all that money they've collected from Napster and the customers they've sued? If I was them I'd hire a PR firm and have press conference as I started handing out checks to the artists I was supposedly representing. There is nothing wrong with the state of the music industry except the majors want their distribution back. Your time of control is up. Keep trying to sell us your 8-track methods in a digital world.

    Posted by: Dale Adams | August 17, 2008 1:24 AM



  28. I never understand the though process of those charged with defending this industry. Their actions have only resulted in killing it off quicker.

    Posted by: Chris Nixon Posted on FriendFeed   | August 17, 2008 1:58 AM



  29. thanks. youu. byee

    Posted by: izmir evden eve | August 17, 2008 2:14 AM



  30. I love Pandora. It is one of the best online music sites out there.

    Posted by: Bernard Lunn Author Profile Page | August 17, 2008 2:46 AM



  31. For all those getting on their high horse about the music industry in this - look, Pandora is a business, who basically screwed up their business model (i.e. they built in around not having to pay for the content they broadcast).

    If cutting out the middle man (aka recording industry) was such a great idea, then someone like Pandora should have been making it work - instead, whether it's Pandora, Torrent trackers , YouTube, et al - it always seems that 'professionally' produced content is more popular option, which is something we should be paying attention to.

    (You could actually learn this by looking at the history of the music industry - I own a lot of small label/self-released material but largely speaking it isn't popular).

    What will I do - listen to my music collection, streaming previews on mySpace or Boomkat, music blogs - there's not exactly a shortage of ways to discover music.

    What there is is a shortage of people with business models that don't involve people producing content for free while they cream an advertising percentage on the side.

    Posted by: JulesLt | August 17, 2008 3:49 AM



  32. I'll be gutted if Pandora closes, I've not used it since it was banned from any other country besides the US but it's a great site!

    Posted by: Kol Tregaskes Posted on FriendFeed   | August 17, 2008 6:03 AM



  33. @JulesLt: The business model seems to work well enough for terrestrial radio, though they aren't subject to the extra fees.

    Posted by: MKR | August 17, 2008 6:43 AM



  34. @JulesLT, that is one of the smartest comments I have read online. If you have a blog, I will like to subscribe to it. For a change we need people who are not thinking out of their asses.

    @MKR, terrestrial radio has a much wider reach than internet radio and the artists get exposure. Internet radio does not have that reach, not until wifi is everywhere and wifi capable devices are as cheap conventional fm receivers, would it have that reach. So in terms of the non-monetary economics, free internet radio basically a loss-loss situation of artists and recording companies, remember they make music to make money not because they just love it.

    Posted by: francis idada | August 17, 2008 10:14 AM



  35. @francis idada: If steep and unjustified fees had been demanded of the earliest broadcasters, would it be so widespread today?

    Posted by: MKR | August 17, 2008 10:24 AM



  36. Where to go, if Pandora shuts down?

    The answer is simple:SLACKER.COM.

    Check it out. You will be pleasantly surprised.

    Posted by: Archangel | August 17, 2008 10:39 AM



  37. I have also purchsed music becuase of Pandora.

    The combination of a service like pandora and legal download services such as itunes and emusic provides a compelling alternative to peer-to peer file sharing services by allowing you a free, legal way to listen and fully preview music before you buy it.

    There are millions of people like myself, who respect the artists and copywrite laws. This record industry has taken another step towrds alienating customers like myself.

    Posted by: JCRChehill | August 17, 2008 10:45 AM



  38. You mentioned Last.FM, let us not forget that they are a media supported company; basically given rights to play the music in horrible quality by the record companies directly. Whereas Pandora is purely open source, having no ties to corporate america/world. In truth it'll be sad that they get taken over, but then again I think it's fair for them to be charged the same cost for playing music as a normal "over-the-air" radio station or even the satellite radio companies, since they are essentially doing the same thing with very similar costs of business.

    Mainly they are making show that they won't get any favors just because they are on the World Wide Web, rather they should be censored and driven under by the World's Narrow Viewpoint.

    Posted by: zero-kill | August 17, 2008 10:54 AM



  39. www.SLACKER.com

    like the other guys said, check it out.

    Posted by: anon | August 17, 2008 10:55 AM



  40. SoundExchange=RIAA

    Posted by: axiomnow | August 17, 2008 10:56 AM



  41. "Pandora is purely open source"

    @zero-kill: Either you don't know what open source is, or you don't know much about Pandora. It is anything BUT open source.

    Posted by: Jonty | August 17, 2008 11:02 AM



  42. What would I do? Well I certainly wouldn't boost content from a site like the Washington Post.

    http://www.washingtonpost.com/wp-dyn/content/article/2008/08/15/AR2008081503367.html?referrer=digg

    Posted by: Anonymous | August 17, 2008 11:04 AM



  43. So how come when you go to Pandora -- they are not loudly letting their users know?

    Are they emailing their users?

    Are they coordinating with other web radio services a political campaign?

    They have all these users and rather than mobilize them Pandora is doing nothing with this leverage.

    If Pandora closes they deserve to close because they are not doing Basic Grassroots Organizing 101.

    Posted by: Pat | August 17, 2008 11:16 AM



  44. well, for us europeans, pandora hasn't been accessible for over a year, which was a huge loss.

    To think it'd dissapear completely is horrible :/

    Posted by: unruled | August 17, 2008 11:20 AM



  45. I have bought legit music from iTunes and Amazon after listening to music on Pandora... it is a great service. It gets dollars into the music companies pocket.

    Sad... if they pull the plug!!!

    Posted by: Al | August 17, 2008 11:28 AM



  46. Soundexchange does not equal the RIAA. The US is one of the few jurisdictions that has not had a performance right in Sound Recordings.

    A portion of all Soundexchange payments go directly to the artists. You should research Soundexchange before you knee jerk on it.

    This is a complicated issue. I really like Pandora a lot. But I also like to see artists, small label owners, etc., get compensated fairly. The rates put in place by the copyright tribunal are not outrageous. They are only outrageous is you are an internet music company that is accustomed to basically paying nothing for the content you deliver.

    This is a false economy and needs to be rebalanced. There is no way that Pandora will shut down. It's too popular. If they can't make a go of it as a stand-alone company, someone will acquire them. Perhaps they'll have to air commercials in between songs, or something like that. I wouldn't be bothered by that personally. The actual music being played would still be superior to what is on terrestrial commercial radio.

    My beef with regular radio isn't the commercials. It's the shite music that most of these stations play. I suspect that there are plenty of other people who feel the same way. There are also other people who would probably be willing to pay a subscription fee to not have to listen to commercials. Good for them.

    This shut-down threat is mostly rhetoric to try and get the government to intervene on behalf of these large web-casting companies and undo a great deal of research and fact-finding by the copyright tribunal. This was a long and very thorough-going process. The large internet music companies didn't get the result they wanted, so now they are trying to short circuit the process in Congress.

    I am not an apologist for the RIAA. But I do work with lots of artists, and I think that in the long run we will be better off if there is a system in place that compensates them fairly for their work. As things stand, ASCAP and BMI payments are some of the only steady money that songwriters see from exploitation of their work. Soundexchange is a means by which the people who played on the sound recordings of the songs can also receive some compensation for their labors.

    Music is not free. People spent time and money making it. They should have a chance to get something back directly when it is used. It's just not enough to say that, "oh they'll make it up playing live and selling t-shirts," especially when gas is over $4.00 a gallon in the US now.

    Soundexchange has compromised on small-webcaster royalty rates, which are significantly lower than those of the larger players. So this really is about large corporate webcasters who don't want to pay fair value for the music they stream.

    I know nobody wants to have to pay for anything, and I'm that way myself, especially when I haven't thought through the whole picture.

    But before you just knee-jerk and say Soundexchange=RIAA, do a little research and learn about the issues.

    The lack of a performance right in sound recordings under the US Copyright law isn't some sort of inherently logical policy choice that should never be undone. It's the result of decades of successful lobbying by the broadcast industry going back to probably the 1930s. These sort of threats to shut down are a part of that lobbying effort.

    So before buying that stuff hook, line, and sinker, at least take the time to research the whole issue.

    Posted by: j-lon | August 17, 2008 11:32 AM



  47. I fear it may already be too late, but when Pandora was released for the iPhone, they should have charged $5 for it, or something. I would have gladly payed for the service.

    On that note, if anybody is willing to set up a method to donate to this cause (via paypal, or some other method) I would gladly contribute my share. With $5 from all the real devoted listeners, it could make up at least the amount they are getting hit with. If they are gonna get slapped with heavy fees for listening (and I agree this seems like "giving in" to the RIAA), they need some revenue to offset it.

    Posted by: Aerohead | August 17, 2008 11:47 AM



  48. The real problem at hand is the availability to discover new music, then to be able to listen to it, and then make the decision to purchase what other materials that the artist has available.

    We used to have this avenue via traditional radio. Years ago, any new song or artist was introduced on the radio, and listeners could call and request to hear the song again and again, and that would be a gauge of the musicians popularity.

    I don't know about you, but when I spin the dial and land on a radio station and find a station whose main product is to deliver music, it's either in the middle of a long stream of uninteresting and annoying commercials, or the endless battalion of radio stations are playing Classic rock, soft rock, or Top 40 that never seems to change.
    It's a Beatles, Led Zeppelin, Rolling Stones, repetitive cycle.

    Cookie cutter country, or rap /hip-hop are not a genres I'm interested in, but I would think that listeners of those types are stuck in the same loop when they tune in.

    How many times over the years can the same song be played over and over and over again? I graduated from high school in 1976, and the stuff I heard back then is STILL in regular rotation!

    Radio stations are blaming iTunes, and other portable players as a reason that they are loosing listeners. when the real problem at hand is that a real music lover lovers hearing new and exiting music from sources that are filling the empty void that is now over the airways.

    The Internet become the transport mechanism for new music, and the various social networks have replaced the face to face word of mouth that happened when broadcast radio was at it's prime.
    Pandora , last.FM, and all of the others have found what traditional radio has lost, yet the labels, are blind to that. They're still trying to sell the Beatles, Led Zeppelin and the Stones and the ilk from that day, when everyone has heard it all before.

    Posted by: nametheblame | August 17, 2008 12:14 PM



  49. It is like everything else in this world. It is not about cost. It is about usability. If a product or service is actually useful and exactly what a customer needs then it is usually quite expensive. Because customers want their music on their terms. Portability, accessibility, etc. The recording industry is going to charge for it.

    When it all comes down to it they are only cutting their own throats. There is only so much people will pay for music. After that more people will turn to piracy to get music and if those sources are not available then they will just eventually stop listening to that music and find alternatives. Like say local bands / artists. Or maybey independent artists. Anything really.

    Greed is an ugly ugly thing!

    Posted by: Nathan Kohlman | August 17, 2008 12:22 PM



  50. Why the hell are they shooting themselves in the foot? I've discovered many new artists who I later bought tons of music from on iTunes.

    But the record industry wants us to pay every time we listen to our music on devices controlled by the only record company they work with, and they probably also want to charge royalties for each time someone speaks the name of or hums a few lines from a song.

    Posted by: Jacob | August 17, 2008 12:22 PM



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