Tuesday, July 15, 2014

DOJ Probes Possible Collusion Against Pandora

The Dept. Of Justice has sent out document requests to music publishers Sony/ATV and Universal, as well as trade groups ASCAP and BMI, regarding the consent decrees through which they provide performance rights to Pandora and others.

The agency is investigating allegations of "coordination" between the publishers and trade groups to secure higher royalties. The probe comes after Pandora alleged during a 2013 rate-setting trial the parties colluded to change ASCAP/BMI by-laws that would allow for partial rights withdrawals, a move that paves the way for higher royalties.

During the trial, Judge Denise Cote found proof of "troubling coordination" between ASCAP, Sony, and Universal, but had no jurisdiction on the matter to make a ruling.

Content acquisition costs accounted for 56% of Pandora's Q1 revenue, with recording royalties (different from performance royalties) making up the biggest portion of the total. Q2 results are due on July 24.

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