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Pink Floyd says Pandora is trying to rip off musicians

As a music lover, you might say that we're living in the golden age of music discovery and accessibility. Many musicians, however, say it's a big problem.

With iTunes, users can easily purchase and download songs from a selection of over 26 million titles. With Spotify, users can stream music on demand. With Pandora, users can customize their own internet radio stations to stream and discover songs based upon their distinct musical tastes.

There are, of course, even more music services out there for us to enjoy. Indeed, Apple will be upping the ante this fall when it releases iTunes Radio, its own take on personalized internet radio.

So while music lovers have never had it so good, a number of artists are complaining that they're not getting justly compensated from streaming sites like Spotify and Pandora.

As an illustrative example, singer songwriter David Lowery recently penned a post where he writes that a song of his was streamed over 1 million times on Pandora, but only netted him US$16.89.

Pandora, meanwhile, is actively campaigning Congress to lower the royalty rate used to measure the amount it owes to artists.

As you might expect, this doesn't sit well with a lot of artists.

This past weekend, band members from Pink Floyd penned an op-ed in the USA Today arguing that many artists are already getting ripped off by Pandora.

We've heard Pandora complain it pays too much in royalties to make a profit. (Of course, we also watched Pandora raise $235 million in its IPO and double its listeners in the last two years.) But a business that exists to deliver music can't really complain that its biggest cost is music. You don't hear grocery stores complain they have to pay for the food they sell. Netflix pays more for movies than Pandora pays for music, but they aren't running to Congress for a bailout. Everyone deserves the right to be paid a fair market rate for their work, regardless of what their work entails.

Pandora has historically done a great job of getting their point of view out into the blogosphere. That said, it's interesting to see a band as prominent as Pink Floyd take to the web and do the same.

Overall, it's an interesting debate and, unfortunately, a complex problem to solve given the divergent interests of all the parties involved.

The typical Pandora user wants to pay nothing. Meanwhile, Pandora wants to pay musicians less and musicians want to get paid more.

Pink Floyd acknowledges that this isn't necessarily an easy nut to crack and urges for more constructive dialogue between all the parties involved.

We're not saying that the music business is perfect or that there is no room to compromise. Artists would gladly work with Pandora to end AM/FM's radio exemption from paying any musician royalties – a loophole that hurts artists and digital radio alike.

Other changes and compromises may be possible as well. The open letter to Pandora that we signed last year said, "Let's work this out as partners" and that's what we should do. But tricking artists into signing a confusing petition without explaining what they are really being asked to support only poisons the well.

Is there a workable solution here that would keep users, Pandora and musicians happy?

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