Your Past Defines You

2013-08-19_1452One thing that I have been particularly grateful for from my previous job is the experience of traveling. Although, I only spent 2 months of 2012 in my own bed (yes, less than 60 days at home!), every experience becomes my sole property.

Everything you do right now and have done in the past, not only defines you, but eternally gives you the strength you need to become who you’re meant to be. The pain, the happiness, the joy, the misfortune, the suffering are all part of you.

Simplistically, what ever doesn’t kill you makes you stronger. You live, you love, you grow.

How Much Pandora Pays for 1,000,000 Plays via Theunderstatement

If you’re a musician or own some kind of music that may be streamed/played via internet radio, here’s something that might be of interest.
David Lowery’s “My Song Got Played On Pandora 1 Million Times and All I Got Was $16.89” article has been picked up over and over and over, including by very respectable folks, often without comment.

This has left many readers with two impressions:

  1. Pandora only paid $16.89 for 1 million plays.1
  2. Pandora pays much lower royalty rates than Sirius XM and especially terrestrial AM/FM radio.

Music royalties are complex, but both of these are patently untrue.

WHAT DID PANDORA PAY & WHAT DID THE BAND GET?

Step 1. Lowery and his royalty reports clearly state he only owns 40% of the songwriting. As he says, this means the total fee to the songwriters was $16.89 x 2.5, or $42.23.

Step 2. Songwriters actually only get about 43.5% of the songwriting/publishing rights. The publisher and the songwriters split the fee 50/50 after the rights administrator’s (BMI in this case) operating expenses, which appears to be about 13%. So the full songwriting/publishing fee was in fact about $97.

Step 3. Pandora also pays a separate royalty for the performance itself, distinct from the songwriting. In 2012, that royalty was $0.0011 per streamed song.2 For 1,159,000 plays, that works out to a total performance royalty of $1,274.90.

After the administrator SoundExchange takes its fee of 5.3%, the performance royalty is split, with 50% going to the recording owner (i.e. record company), 45% to the band/performer, and 5% to any session/backup musicians. So the band in this case received $543.30 for their performance.

Conclusion. By this math:

  • Pandora paid a total of about $1,370.
  • The band received a total of about $585.
  • If Lowery received 40% of the performance royalty, “all he got” for the 1 million plays was in fact around$234.

Whatever one thinks of the fairness of those numbers, they’re all clearly far larger than $16.89.

HOW DOES THIS COMPARE TO SATELLITE & TERRESTRIAL RADIO?

The main issue here is that Lowery cites only dollar amounts for comparison:

  • “For frame of reference compare [sic] Sirius XM paid me $181”
  • “Terrestrial (FM/AM) radio US paid me $1,522”

This is quite simple: those sources paid him a lot more primarily because a lot more people heard his song via those sources.3 For example, AM/FM paid him $1,373.78 for 18,797 spins. That’s 7.3 cents per spin. If only 10,000 listeners heard each spin, terrestrial radio is in fact paying just half the songwriter fee Pandora paid him per listener. And of course it’s likely to have been far more than 10,000 – even the intentionally miniscule South Dakota radio station Pandora just bought manages to average 18,000 listeners.

Even more importantly, FM/AM paid him NOTHING for the performance of the song. Unlike most industrialized nations, terrestrial radio stations in the US have never paid performers anything.4 It’s hard to believe, but true: they can play John Coltrane’s version of “My Favorite Things” for decades and never pay him or his estate a single cent.

Lowery doesn’t disclose the Pandora performance royalty but he declares it “unsustainable.”5 This is a fascinating perspective: apparently in Lowery’s view a performance royalty of $1,275 is unsustainable but the AM/FM world of $0 is totally fine?

AM/FM radio royalty payments are contractually capped at just 1.5% of revenues, meaning a measly 0.7% of radio revenues go to the actual songwriters – and 0% to performers.6 Pandora would indeed love to get down to those much lower rates that competitors like iHeartRadio already get to pay because they’re owned by a terrestrial radio conglomerate. Strongly implying that Pandora’s royalty rates are already far worse than AM/FM seems just plain misguided.

A CONCLUDING THOUGHT

None of this means Pandora ought to pay less in royalties. On the contrary, it seems quite likely that others should be paying more. And perhaps the non-artists involved in the transaction shouldn’t be taking 53% of the total for their services. But attacking Pandora with intentionally misleading statistics just undermines the credibility of the argument.

30 Thought Provoking Questions

1. What great thing would you attempt if you knew you couldn’t fail?

2. What would you do if you were ten times bolder in your relationships, work, family, and spiritual life?

3. What would you be doing if you had all the money in the world?

4. If you could teach something, what would you want to teach?

5. If you left this life tomorrow, what message would you leave behind for the next seven generations?

6. How short would your life have to be before you would start living differently today?

7. When was the last time you went someplace you had never before?

8. What is your biggest dream?

9. Can you describe your life with a six-word or less sentence?

10. When was the last time you tried something new?

11. What makes you come alive?

12. How much control do you have over your life?

13. How would your life be different if you knew you weren’t judged or criticized?

14. Why do you love what you love?

15. When you’re much older, what type of stories do you want to tell?

16. Beyond color, nationality, job titles accomplishments, sexual preferences, or labels given by others… who are you?

17. Are you settling?

18. What does your joy look like today?

19. Finish this sentence: When i think of love, I think of…

20. What did you want to be when you grew up?

21. What could you say was your defining moment?

22. How do you define “soul”

23. When did you become so fearful as an adult?

24. If you could go back and do something again, would you have made the same choices?

25. If you were God, with the absolute power of creation, how would the world look?

26. What are some things worth fighting for?

27. What is the most important thing to teach a child?

28. Where is heaven to you?

29. What do you want your future self to say about your present self?

30. If you were God, with the absolute power of creation, how would the world look?