Saturday, July 19, 2008

Closing Pandora's Box

The ever-used service Pandora, which allows users to find music that meets their taste by relating it to their favorite musicians, is closing down:

The [record] labels are intent on charging so a high price for streaming royalties that Pandora and its even-weaker peers would be forced out of business. That appears to be exactly what the labels want, despite the fact that research shows these kind of services actually increase record sales, as listeners discover new music and reconnect with old favorites.

Pandora and others are willing to pay royalties but need rates low enough to make enough profit to keep the service going. Such royalties historically have been set by government. Pandora is trying to get the attention of Congress, while making clear that Pandora's demise would cause internet radio to be dominated by the likes of Clear Channel. In other words, a faceless company's idea of mass hit entertainment shoved down our earholes.

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