Pandora & Universal Music Publishing Reach Royalty Deal
July 3, 2013
Pandora and Universal Music Publishing Group(UMPG) have reached a short-term, direct royalty deal, which reportedly would pay out the highest royalty rate the popular music service has ever agreed to. A spokesperson for UMPG told Billboard.biz, "We can confirm that UMPG has worked out an arrangement with Pandora that we believe is in the best interest of our writers while ensuring Pandora access to our music through the end of the year."
However, Billboard notes that this agreement could be shot down in ASCAP rate court, which is expected to rule on a motion recently filed by Pandora, arguing that publishers can't cut their own direct royalty deals because they are under an ASCAP consent decree. Any music publishers attempting to reach direct royalty deals may still be obliged to legally accept ASCAP rates until the end of 2015.
Billboard adds that in making this deal, Pandora has avoided any potential liability for continuing to offer UMPG's catalog. Otherwise, if ASCAP rate court ruled against Pandora, the service would have been in violation of copyright as of this past Monday. Sources told Billboard that Pandora has also been in talks for a "grace period" while awaiting ASCAP's rate court decision, which is expected at the end of this month.
Warner/Chappell Music and BMG Chrysalis have also filed notices of intent to withdraw their digital rights from ASCAP, as of July 1, but sources told Billboard that Warner/Chappell has opted to delay its withdraw until January 1, 2014.
Earlier this week, The Financial Times revealed that Pandora Co-founder Tim Westergren had "a crucial meeting on Monday with music industry representatives following its latest row over royalty payments."