Last week we learned (here) that leading webcaster Pandora -- in addition to backing the Internet Radio Fairness Act with the hope of a lower sound recording royalty -- filed suit against ASCAP with regard to royalties on music compositions. A short piece in the Copyhype blog reviews the history of ASCAP, "consent decrees," and "rate court" to show that Pandora's suit is simply "part of the process... The court filing doesn’t allege any sort of malfeasance or breach..."
Reads the blog, "Under the consent decree, ASCAP is required to provide a reasonable fee upon request. If a potential licensee disagrees with the fee provided by ASCAP, it can bring suit in court. ASCAP has the burden of proving the reasonableness of the fee; otherwise, the court will weigh the evidence to determine a reasonable fee."
Pandora and ASCAP -- one of three U.S. performance rights organizations that collect and distribute royalties for the use of song compositions -- have negotiated for a year but have been unable to reach an agreement on what the webcaster should pay. Pandora reportedly wants a deal similar to what AM/FM broadcasters have. Earlier this year ASCAP and radio agree broadcasters would pay 1.7% of their gross revenue, minus deductions based on advertising commissions.
Read the Copyhype piece here.