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Copyright License Fees Drive Pandora Out of Canada
An anonymous reader writes "Online streaming music services such as Pandora are abandoning plans to launch in Canada, claiming licensing fees are too high: 'These rates ... are astronomical,' Tim Westergren, founder of California-based Pandora, wrote in an email to The Canadian Press. The agency that collects music royalties in Canada on behalf of record companies and performing artists wants to charge web-based music sites that stream to mobile devices the greater of two figures: 45 per cent of the site's gross revenues in Canada or 7.5-tenths of a cent for every song streamed. Meanwhile, record labels are blaming the lack of online music services in Canada on piracy: 'Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?' said Graham Henderson, president of the Canadian Recording Industry Association, which represents major record labels."
Graham Henderson: another useless motherfucker who needs a bullet in his head.
There is a war going on for your mind.
"I eat because I'm unhappy and I'm unhappy because I eat." Fat (non-Canadian) Bastard
Living With a Nerd
Fuck them and fuck their bitching. As a Canadian, I'm quite happy with the way our laws our (currently). And I do "still" buy music, both from iTunes and CDs, so these guys can.. complain.. somewhere else.
Money is tight for companies like Pandora, which is why they should go in to the hardware business like Slacker, or at least partner with Slacker. Slacker blows the competition away because of the availability of portable hardware specifically designed for it. Pity Woot! hasn't had a Slacker for sale in quite a long time, though.
Fuck the RIA ... errr ... I mean CRIA!
If you tell me the truth you will hurt me, so you mustn't. But if lie you will hurt me too so you must. But if you do you will hurt me so you mustn't. Herbie would certainly have quite a time with this story.
I'm happily streaming music from Rdio for $4.99/mo in Canada. I recommend it.
I've bought and paid for every single Nickleback album I have in my collection. Which is none.
Hi, I Boris. Hear fix bear, yes?
I buy blank CD-Rs, as do so many other people I know of. The cost of music is built in those. Once you have a stack of CD-Rs, you are no longer able to pirate music in Canada, as long as you only leech. It's the law. They made it. If they don't like it, tough.
"Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?" said Graham Henderson, president of the Canadian Recording Industry Association, which represents major record labels.
Somebody please tell Mr. Henderson to take his head out of his ass. The fact, as he well knows, is that Canadians already pay hefty fees. We already pay for recorded music at a rate far in excess of the cost of distribution. Radio stations already pay royalty fees. And everyone already pays a surcharge on recording media and players so that we can be legally entitled to generate copies for personal use.
How did this media surcharge come about? Because Mr. Henderson's own organization, the CRIA, successfully lobbied for it! That's right. They insisted that Canadians must pay a surcharge in order to legally record music. And so we have been doing, ever since the late 1990s.
Mr. Henderson finds this convenient to forget, but the rest of us have not forgotten. Even those of us who do no music copying at all have already paid in full for entitlement to copy.
Parity: What to do when the weekend comes.
What about labels who don't belong to the RIAA? It seems like this would be a great way for Pandora--especially Pandora, since they're pretty popular, and people know the name. Probably more so than any other free-to-stream radio--to stick it to the major labels. Just stream indie labels, those who don't belong to the CRIA, or labels who give their stuff away for free, or license it for free for this kind of thing.
So Sayeth Graham Henderson:
"(Canadians) just seem to have no appetite for a legal marketplace."
Damn you and your illegal market tastes. We hate your for your love of violating the law and living on the edge of civil and criminal lawsuits.
-Rick
"Most people in the U.S. wouldn't know they live in a tyrannical state if it walked up and grabbed their junk." - MyFirs
Rip your own. Put them on your MP3 player.
Most of these download and streaming media sites have onerous terms and conditions, anyway.
Honestly, I hope everyone just stops buying music altogether. I would love to see the RIAA, CIRA, and the greedy big labels just go away.
Mr. Henderson is an idiot, no offense to the intellectually challenged out there. He, like everyone else in the music industry, has blinders on, and is clueless as to what the people with the money (ie, the CUSTOMERS) want. I'd love to get Pandora here. It was brilliant while it lasted, and nothing else I've tried has been able to beat it. And here's the irony for CRIA and their ilk: since Pandora got shut off in Canada, I've simply gone back to downloading. Yes, it's still legal here, as long as we're paying the blank media levies we do. And Mr. Henderson can kiss my shiny metal ass, because I'll NEVER pay a cent for music from artists he 'represents'. Not even to a 'legal' streaming service. Am I sad Pandora has given up on Canada? Yes, because I loved their system. And no, because it really doesn't affect me anymore. iTunes has Genius, which is pretty damn good these days, and since I can happily download tunes till I'm out of drive space.
"Apparatus dignosco occultus, satis non supernus."
Unless you're running a cost-free operation, with no employees, servers, or bandwidth, gross revenues are not equal to profit. Say that you have a low-cost operation and 70% of gross revenues are profit, though. That means that the recording industry wants a licensing fee of 2/3 of your profits? And even 70% is pretty good; it's not uncommon to be running profit margins that are 45% of revenues or less, in which case the recording industry would actually be taking all of your profit, plus possibly more.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
The agency that collects music royalties in Canada on behalf of record companies and performing artists wants to charge web-based music sites that stream to mobile devices the greater of two figures: 45 per cent of the site's gross revenues in Canada or 7.5-tenths of a cent for every song streamed. Meanwhile, record labels are blaming the lack of online music services in Canada on piracy: 'Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?
Now we all know who the real music pirates are.
No doubt about it! We're a bunch of donut eating, hockey watching, MUSIC THIEVES! The blank media levy is funding our shitty musicians like nickelback and the Bieber. If Graham Henderson had his way, you'd pay per listen on your 8-Track.
But when Graham Henderson hears about it, you're stuffed....
If I had an Ass, I'd call it Fanny Bottom, then I could slap my Ass; Fanny Bottom, on the Arse.
I used to buy a lot more music on iTunes when it was 99 cents but now, with variable pricing, virtually all songs on the Canadian iTunes are 1.29 CAD each so I have stopped buying so much.
The record companies need to stop running their businesses like they are some big movie studio and start finding ways to save money so that they can offer music for less and offer artists less money upfront but more royalties for each song sold electronically.
The old model of upfront contracts will not work anymore in this new digital world.
Jesus was a compassionate social conservative who called individuals to sin no more.
"Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?"
I think the question companies are asking themselves is "Why would you spend a lot of money trying to build a service in Canada when fees paid to the CRIA make it impossible to make a profit from such a service"?
It's the lack of decent cost-effective services (we're already paying lots for our music with fees on media) that drives everyone in Canada to use file sharing services in the first place.
Meanwhile, record labels are blaming the lack of online music services in Canada on piracy: 'Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?' said Graham Henderson, president of the Canadian Recording Industry Association, which represents major record labels."
Let's not forget that the CRIA is facing a six billion dollar lawsuit over commercial copyright infringement of over three hundred thousand songs. Regardless of your position on piracy, these guys have no leg whatsoever to stand on. If they're going to go after individuals for noncommercially sharing music, first they'd better clean up their own mess.
That Anonymous Coward guy is pretty annoying. Can we have the government censor him or something?
45% of gross? Not even net? Wow. With taxes like that, no wonder so many Canadians cross the border to purchase a variety of goods. Ugh!
Piracy is the de facto reason given for not doing something in these industries. "We aren't developing this video game title for the PC platform due to piracy concerns", "We aren't offering this broadcasting service because of piracy concerns"... it's a never ending guilt trip. If there's a demand for something and you can't/won't fill that demand for whatever reason, blame piracy!
20 songs per hour, 52 weeks a year.
40*20*52 = 41600.
At the latter rate, that is 41600 * 0.0075 = $312.
And that's before Pandora's own expenses, such as bandwidth and payroll.
How are Canadian music lovers supposed to pay for music if no one builds a service to do so?
How much of these punitive fees would actually make it into the pockets of the artists? I doubt it would be much. Sounds like a clear case of the Canadian music industry wanting to cash in big time. They want money for doing absolutely nothing! and why does the article insist on speaking in terms of fractions of a cent? Is there something so difficult about the decimal system?
http://www.acetonestudio.com
This is because of all those moose pirates up in Canuck territory. You would download music too if all you had were Alanis Morriset and Bryan Addams.
"I'm not a quack, I'm a mad scientist! There's a difference." - Dr. Cockroach
So here we have the owner of a music streaming business telling us all why he won't come to Canada.
And then we have Mr. Asshat, er, I mean Henderson telling us it's a completely different reason that such businesses (which he doesn't even own) won't come to Canada.
Who are we to believe? The horse's mouth or the horse's ass?
'Why would you spend a lot of money trying to build a service in Canada when Canadians don't want to give their hard earned money to a corrupt, bully-run industry of assholes who think they are above the law?'
There yah go Mr. Henderson, I FTFY. Retard.
Motorcycles, Robots, Space Gossip and More!
The CRIA was the ones who whined and lobbied so that all blank media in Canada has a surcharge on it to pay them for piracy. The led to the widespread conclusion that since we're already paying for it, we're allowed to. The courts have backed us up on this too.
And this is just hilarious:
So, if it was a 99 cent song, they would either want 1 cent, or 45 cents -- since 45 cents is bigger, they'll take that.
Just how much money do they think they're entitled to? I don't download music, but I have little sympathy for these organizations. It's gotten to the point that I will burn a CD of MP3s for friends and not feel even a little guilty for it -- I've bought the CD, and I've paid the media tax ... er, levy.
Lost at C:>. Found at C.
Uhm we pay for the right to copy. The Canadian branch of the RIAA fostered a levy on CD-R media a while back the levy also applies to MP3 players and the like.
We pay for it so they can take their complaints about pirates and stuff it.
http://www.digital-copyright.ca/node/1657
Actually after lobbying for years and being happy about getting the levy they now want it removed.
http://www.afterdawn.com/news/article.cfm/2007/09/17/cria_disputes_canadian_mp3_player_levy
I've brought up the issue of Canadian content in music with friends and in several university classes. I've yet to hear a convincing argument. Maybe someone here can provide an insightful answer. Slightly off-topic, but on subject, since many of these fees are intended to protect "Canadian Content".
When I hear of Canadian Music or Canadian Content, I know that the intention is 1) to protect the Canadian Music Industry and 2) from the perspective of the government to protect "Canadian Identity" and "Canadian Culture". This second argument is usually the one that people fight most to protect especially in the government (and probably lobbiests) as its a softer issue than dealing with the money aspect and has a nice ring to it - we're helping you protect all of our identities.
I have bought my fair share of CDs over the last 10 years (probably over 500). I'd say about 50% of that is American artists, 40% Canadian and 10% European/Asian. I've yet to hear any song (save our Nat. Anthem) that is distinctly in whole or in spirit so damn different from American music. I listen to rock, metal, country, jazz, blues, folk, rap. The BareNaked Ladies strikes me as having been the most popular band with some Canadian references in the songs. (Not a fan) but otherwise Neil Young and Tom Petty are probably the next closest. But even then substitute a few words here and there and you're listening to an American performing the same song.
Other than that across all genres of music, there isn't much to say this song IS Canadian. Even a lot of the (newer) French Canadian music, is the same and is indistinguishable from the rest. It makes reference to French culture - but not generally Canadian or (generously) French Canadian culutre.
So these Tarifs seem to be implying that they are protecting the Canadian music industry. Yet, the consumer is the one that chooses (regardless of piracy rates) what albums he or she will buy. And besides, you are more than free to listen to any number of streaming radio stations on the Internet. Heck, I like those stations better since they play anything but the same Canadian artists on local radio stations.
In the near future, no one will pay for music. The only people still buying music are the copyright apologists and those who don't know how to download. As culture advances, these people will become fewer.
It is accepted economic principle that in a free market, the price of a good naturally approaches the marginal cost of production. The marginal cost being zero. Granted, the market isn't exactly free: record companies have a monopoly on their product and piracy is the black market, but since copyright is unenforceable, the playing field is level.
This sort of price gouging is an example of why copyright is a flawed concept, especially in the digital age. It's anti-market and immoral.
'Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?' said Graham Henderson, president of the Canadian Recording Industry Association...
Smart. Very smart. Rather than adopt a business model of offering affordable alternatives which most people would be happy to go with they're going to cut off their noses to spite their faces. They're happier to take 45% of nothing rather than a reasonable licensing fee of a reasonable price.
These people are so utterly daft that the mind absolutely boggles. Is it any wonder that they are incapable of adapting to a new technological age and prospering in that age? sigh...
The worst part is these individuals are getting rich from high salaries while the rapidly drive their industries into the toilet. And, once everything gets flushed away, these individuals will walk away with their vast savings and live happily ever after while they've demolished an industry and left it in the stone ages.
sigh...
45% of gross? Not even net? Wow. With taxes like that
Sorry, but what the fuck are you talking about? How exactly is a company that charges for the right to use their product a "tax"? What exactly does any of this have to do with "socialism"?
Smart. Very smart. Rather than adopt a business model of offering affordable alternatives which most people would be happy to go with they're going to cut off their noses to spite their faces. They're happier to take 45% of nothing rather than a reasonable licensing fee of a reasonable price. These people are so utterly daft that the mind absolutely boggles. Is it any wonder that they are incapable of adapting to a new technological age and prospering in that age? sigh... The worst part is these individuals are getting rich from high salaries while the rapidly drive their industries into the toilet. And, once everything gets flushed away, these individuals will walk away with their vast savings and live happily ever after while they've demolished an industry and left it in the stone ages. sigh...
THIS!
Their profit margins and revenues are soaring higher every year, and still they pretend that piracy has their entire industry on the brink of collapse.
More likely, they're just butthurt that some pirates are eating the scraps that fall from their table.
The linked article mentions "the agency that collects music royalties in Canada," which should be understood to be a separate entity from the Canadian Recording Industry Association.
It's worth pointing out that there are several different agencies and several different sections of copyright law at work here. Purchasing a song for your own use and playing a song in a public place (or over internet radio) are two different things. I often see people in the US confusing the RIAA with ASCAP and vice versa, and a little clarity might be helpful.
So, in the US:
The RIAA represents distributors and publishers.
ASCAP and BMI represent songwriters and publishers, who are supposed to get a royalty when a piece of music is performed or played in a public place (or over internet radio).
SoundExchange represents performers or recording copyright owners, who are supposed to get a royalty when their recordings are played in a public place (or over internet radio).
So when all hell breaks loose and Justin Bieber does a cover of Michael Jackson's Billie Jean that is then streamed over Pandora, Soundexchange would collect royalties for Bieber's performance and ASCAP would collect royalties for Michael Jackson songwriting. If the original Billie Jean is streamed over Pandora, then Jackson would be (I believe) entitled to royalties as both the performer and the songwriter. These are performance royalties and are typically paid by the entity playing the recording (in this case Pandora).
When 100 trillion pre-teen girls try to buy a copy of Bieber's version of the song, they pay iTunes or WalMart or whatever, which is then supposed to pay the distributors. These are not performance royalties and are not administered by ASCAP, BMI, or SoundExchange. When you, out of morbid curiosity, illegally download the track, the RIAA will sue you to the tune of $xx,000,000 on behalf of the distributors.
I say this because it's important to know that even though these organizations are related, they are not the same. Also, performance royalties in most cases actually make it to the artist, so I'm hesitant to hate on ASCAP (I'm a member) although sometimes I wish they would just chill out a little bit.
Wow. Sounds like they are more screwed up then us down here in the US.
---- Booth was a patriot ----
the labels are just not willing to face alot of things no matter where you live. there hasn't been any good artist in a dammed long time im sure there is talent out there but the record labels never sign them. even marshal manders with his 2 new albums have been eh. not bad not awesome. even tho he still managed good sales compared to others. and the only albems i bought in years. so they have talentless fools out there for the most part. then you have the company's themselves just doing everything they can to block legit systems out there. with insane fees for broadcasters blocking pretty much everyone. then you have the riaa going sue happy with laws ment for other corps being slammed on everyday people. and they wonder why nobody whants anything made by them. i dont download or buy music.
Just listen to CBC Radio 3 (or get their podcasts). 100% Canadian independent artists. None of the crap from the major labels.
I don't think there is a company in the world which can claim 70% of revenue as profit.
Any mature industry, with any kind of competition whatsoever, will be in the single digits as profits. Only oil & telecom companies, and other massive companies who can abuse monopoly powers can make over 10%.
The newly-established "authors' rights association" in Russia, which is given the state monopoly on gathering fees and levies, wants to have a levy on import of any storage devices into Russia. Not just CD-R, but also USB sticks, HDDs - at 1%, and any devices that contain those - at 3%.
Now where it gets real funny is the rates. The proposal on the table is: only 15% of money gathered goes to rights' holders, while 25% is to be used for "organizational expenses", and the rest is for various culture funds, run by the same people who have established the organization...
Now you see why the "music industry" is pressing for longer and more restrictive copyright laws. It has nothing to do with the artists and everything with to maintain the music publisher's monopoly over works. No wonder, copyright was invented by the publisher to maintain their printing monopoly. Look it up in the history books beginning with the Stationers' Company and the Statute of Anne.
http://www.mueller-public.de - My site http://www.anr-institute.com/ - Advanced Natural Research Institute
I love this guy: 'Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?'. I don't know Mr. Henderson, but Pandora is apparently willing to do so, so maybe you should ease off the royalties a bit and that way you will get some money for "your" music. Instead, without services like Pandora people have limited venues for listening to music and as you said they will just take the path of least resistance and get their music for free. Didn't you learn anything from the past decade's battle over digital music distribution.You aren't in a position to negotiate. People already have access to free music. The only thing you can do is provide them with a legal and more convenient alternative.
I feel similarly about Justin Bieber and Celine Dion as well. *
Great Big Sea reminds us that Canadians *can* produce good music (I was primed for such jokes because those guys are playing a show locally next week. :P)
* I don't have any Avril Lavigne albums either, but I do like her cover of Imagine from the Instant Karma! Lennon tribute album.
I listen to both RIAA and non-RIAA stuff if I like the music, tangential business/politics nonwithstanding.
In a previous comment, I named Great Big Sea positively; I forgot these guys.
I haven't personally gotten into Rush that much like some people do, but I do recognize it as sounding cool. Outside of Canadian music, I feel similarly about Pink Floyd and Incubus.
The Band? Yep, no wonder they worked with Dylan.
Arcade Fire is a big new name that I'm well aware of but haven't checked out yet. (Saw Soundgarden instead at Lolla 2010, for instance)
I listen to both RIAA and non-RIAA stuff if I like the music, tangential business/politics nonwithstanding.
God damn I hate saying this over and over again, but.. .. I BUY MORE MUSIC THAN ANY OF MY FRIENDS.
And I pirate music.
Then again, I'm probably preaching to the choir here, and I doubt anyone important to the biz is reading these comments.
What is this weird value? Why are fractions being mixed with decimals? How about 0.75 cents? 75 hundredths of a cent? Three quarters of a cent?
.
Until the wheels and handle comes off...
.
Fuck them all.
.
If the dead from the anus up "corporate moron types" had of gotten in early and quick, to make an easy to access, sensibly priced, DRM free content, then there would have been very little of the P2P sharing....
.
But Nooooooooo - the head games of force them to eat our marketing model at the price we say so with a shit load of restrictions and consumer / product lock in...
.
and away the market went.
.
Voting up, Voting down - If I really gave a fuck about your approval or not, I'd come and ask you.
Yeah, 70% is pretty absurd, but you can definitely beat 10%, especially in tech. Google makes about 30-35% of revenues as profit, for example.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
"'Why would you spend a lot of money trying to build a service in Canada when Canadians take so much without paying for it?' said Graham Henderson, president of the Canadian Recording Industry Association" ...in this instance, I believe it should be read as 'Canadians=CRIA'?
~men are from earth. women are from earth. deal with it.~
I'm going to have to charge you royalties. You see, that "wooosh" noise you just heard is a copy righted track from my latest albumn, "Sounds of Sarcasm". For the illegal usage of my art, I am going to have to sue you for $75,000. I'll settle out of court right now for just $2,000.
-Rick
"Most people in the U.S. wouldn't know they live in a tyrannical state if it walked up and grabbed their junk." - MyFirs
A Similar problem existed for Sirius satellite radio. Sirius negotiated lower rates and people buy the product even though Sirius to this day pays large amounts of licensing fees and Canadian Content development fees. It is my understanding that Sirius pays more for Canadian Content development than all of terrestrial radio. This does not stop them from having success and seeing decent growth in their subscriber base. I would assume that the rate is high as the copyright board astutely assumes that Pandora's success will mean Sirius' loss, and they are out to protect that flow of revenue into the development of Canadian Artists.
Pandora is being either lazy, chicken, or greedier than the politician.. 'Oh no, big fat bureaucrat wants lots more money than our 2-bit business plan expected, run away'. They should go back to the table with some market research that shows their expected revenues and makes a fair case for how much they should actually pay. Comparisons to terrestrial radio will get you nowhere. Finding a pricing model that works within that franework is what is needed. They won't require a significant hardware investment to reach Canadians. So what if their profit margin won't be as large as hoped; It will still be a good profit margin if they negotiate to a lower rate.
Yes, one could go into arguments about the validity of Candian Content Development, blah blah blah. Bottom line is that the copyright board exists to extract higher fees from new entrants into the markets. Get over it and get on with business.
the record companies need to die
production costs and distribution costs in the age of in the internet are minimal
artists can self-produce and self-distribute. if they gain fame, they gain fortune via concerts, advertising, personalized content, ancillary material, etc
end of story
sure, most artists will be starving. as if that is something new to the internet era
all that is new to the internet era is that the parasites of the distribution industry simply aren't need anymore. the business models have already abandoned them, all they have going for themselves are cultural and legal inertia
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it