Pandora latest borrowing - it raised $300m from investors - has left Wall Street unimpressed: the convertible debt offering on Wednesday (December 2) led to stock dropped by 11.5% on the NYSE yesterday. In March last year, Pandora's total market cap value soared above $7.7bn. Today, that figure sits at $2.7bn - wiping $5bn off a valuation that stood less than 24 months ago.
Pandora has agreed a landmark direct multi-year licensing deal with Sony/ATV in the US. The deal means that Pandora "has effectively bypassed the standard US compulsory licensing process – and its custodians, collection societies ASCAP and BMI – to gain access to Sony/ATV’s repertoire."
As a result, Sony/ATV says it has been able to negotiate improved rates for its 4 million copyrights directly, while Pandora says it will ‘benefit from a greater rate certainty and the ability to add new flexibility to the company’s product offering over time’. A similar direct agreement was reached by Pandora with BMG last year, while the independent labels recorded music body Merlin has also agreed a direct deal with the platform
http://www.musicbusinessworldwide.com/pandora-strikes-direct-us-licensing-deal-sonyatv/
Online radio provider Pandora is to pay out some $90 million to the three major record companies, Universal, Sony and Warners, along with ABKCO, as payment for use of pre-1972 recordings. In June, Sirius paid $210 million to resolve a long-running lawsuit over its broadcast of older tracks. Pandora will pay $60 million for the use of recordings through 2015, and another $30 million to cover through 2016. Last year, recording companies filed a lawsuit in New York State Supreme Court in Manhattan, accusing Pandora of violating the state’s copyright protections by using recordings of older songs without permission. The move followed the success of Flo & Eddie (The Turtles) in garnering copyright protection for sound recordings under state laws in both New York and California - although they failed to convince a judge in Florida on the same arguments.
Pandora has generated more than $1bn in turnover in a 12-month period for the first time in history, as its listener numbers return to growth. The US-based streaming radio business last night revealed its Q2 fiscal results for the three months to end of June, posting US $230.9m in revenue – up from $177.3m in the same period the year before. However, the company’s net loss widened from $11.7m in Q2 2014 to $16.1m in the same quarter this year. Over the past six months, Pandora has posted $516.3m in revenue, but a $64.1m net loss in total. More here
VentureBeat reports that Pandora Media, the music streaming service, has decided to sell 10 million shares of its common stock which is expected to bring in $230.8 million (assuming a share price of $23.99). The stock sale will also include 4 million shares from CrossCapital Inc., the largest stakeholder in Pandora. The company recently announced the appointment of Brian McAndrews to the role of President and CEO.
Pandora, the US based digital innovator which has spearheaded the development of online radio services stateside and led the 'interactive radio' side of the expanding streaming music market, has bought a good old fashioned FM radio station in South Dakota. The acquisition of KXMZ-FM in Rapid City gives Pandora a seat at the table of the Radio Music Licensing Committee and seemingly would enable it to reduce the royalties it pays to the American music publishers via the music collecting societies, in particular ASCAP, in an escalating row over the 'favourable' treatment given to the major US terrestrial broadcasters such as Clear Channel.
In parallel news, at the World Creators Summit in Washington, DC, the US Register of Copyrights, Maria Pallante, confirmed that she's looking to "provide a full public performance right for sound recordings" in the USA in a move which would see terrestrial radio stations pay to use sound recordings - internet and satellite stations already do - which will cheer record labels and recording artistes.
Soghu has reached a settlement with the major record labels in in China who had sued Sogou and its owner over the MP3 search facility it offered, which the labels said was a gateway to illegal content. Under the agreement, the labels will forget past grievances, and Sogou will become a customer, licensing music for a new streaming and download service, which will be seemingly free to the user (and therefore presumably funded by advertising). The deal echoes that reached in 2011 with another once controversial Chinese search engine, Baidu: elsewhere in streaming news, Apple's much and long mooted streaming service is taking longer than the tech giant would like to reach market because of the firm's royalty offer, with the record labels unhappy with Apple’s current royalty plans; And streaming service Pandora has announced that its revenues were up 56% for the financial year ended 31 Jan, thanks mainly to an increase in mobile revenue, though losses were nevertheless up, from $16.1 million to $38.1 million, attributed to rising content costs. Finally on streaming, O2 has launched a massive £7.3 million ad campaign for O2 Tracks, an interesting mobile-based streaming service that went online last month.
Apple and Pandora have topped a new survey of digital platforms, with Apple's iTunes remaining the dominant player in the paid for music download service sector, with a 64 percent share of the market in the second quarter of 2012. Amazon's MP3 Store comes a distant second with 16 percent, and no other purveyor of paid downloads exceeds 5 percent. Google Play, eMusic, Zune Music Pass and all of the others combined only account for 20 percent. The NPD survey also said that 50 percent of US internet users were aware of Pandora’s free ad-supported radio service, and a third of them also knew that Pandora offered a paid subscription service. Clear Channel’s iHeartRadio had 25 percent consumer awareness, followed by Spotify with 19 percent.
