Pandora: We’re Paying Several Artists More Than $2 Million a Year…

That’s according to Pandora founder Tim Westergren, who was stumping for lower royalty rates on Tuesday in San Francisco. And part of his complicated pitch was that successful artists are making a lot of money off the Pandora platform. “There are artists making more than $2 million from Pandora,” Westegren told attendees at SF Music Tech Summit during a morning discussion.  “And, many artists are making more than $100,000.  You’d be surprised at how many artists are making more than the average household income in America.  We’re talking about making a living on Pandora alone.”

Westergren estimated an ‘average household income’ at $50,000, enough the pay the bills in many cities.  But outside of those details, the underlying message is this: please don’t kill us, labels, SoundExchange and publishers, because we’re good for artists. 

So, ugh, lower rates so they can pay more?  Westergren noted that Pandora is now spending all of its resources on advertising products and advertising sales to satisfy royalty obligations, not on programs that would empower struggling artists.  “The prospect exists for Pandora to actually activate fans for bands traveling around the country trying to bring people into clubs,” Westergren told interviewer Jon Healey, an LA Times journalist.

“But the development on that kind of technology is suffocated, because we spend every last penny trying to develop yet another ad product.  And one of the invisible consequences to this kind of rate is that it stifles innovation, and a big piece of that innovation could directly impact the plight of the working artist.”

Source: Digital Music News