Here's the text of an e-mail I got late last night:
hi, it's Tim,
This is an email I hoped I would never have to send.
As you probably know, in July of 2007 we had to block usage of Pandora outside the U.S. because of the lack of a viable license structure for Internet radio streaming in other countries. It was a terrible day. We did however hold out some hope that a solution might exist for the UK, so we left it unblocked as we worked diligently with the rights organizations to negotiate an economically workable license fee. After over a year of trying, this has proved impossible. Both the PPL (which represents the record labels) and the MCPS/PRS Alliance (which represents music publishers) have demanded per track performance minima rates which are far too high to allow ad supported radio to operate and so, hugely disappointing and depressing to us as it is, we have to block the last territory outside of the US.
Based upon the IP address from which you recently visited Pandora, it appears that you are listening from the UK. If you are, in fact, listening from the US, please contact Pandora Support: firstname.lastname@example.org.
It continues to astound me and the rest of the team here that the industry is not working more constructively to support the growth of services that introduce listeners to new music and that are totally supportive of paying fair royalties to the creators of music. I don't often say such things, but the course being charted by the labels and publishers and their representative organizations is nothing short of disastrous for artists whom they purport to represent - and by that I mean both well known and indie artists. The only consequence of failing to support companies like Pandora that are attempting to build a sustainable radio business for the future will be the continued explosion of piracy, the continued constriction of opportunities for working musicians, and a worsening drought of new music for fans. As a former working musician myself, I find it very troubling.
We have been told to sign these totally unworkable license rates or switch off, non-negotiable...so that is what we are doing. Streaming illegally is just not in our DNA, and we have to take the threats of legal action seriously. Lest you think this is solely an international problem, you should know that we are also fighting for our survival here in the US, in the face of a crushing increase in web radio royalty rates, which if left unchanged, would mean the end of Pandora.
We know what an epicenter of musical creativity and fan support the UK has always been, which makes the prospect of not being able to launch there and having to block our first listeners all the more upsetting for us.
We know there is a lot of support from listeners and artists in the UK for Pandora and remain hopeful that at some point we'll get beyond this. We're going to keep fighting for a fair and workable rate structure that will allow us to bring Pandora back to you. We'll be sure to let you know if Pandora becomes available in the UK. There may well come a day when we need to make a direct appeal for your support to move for governmental intervention as we have in the US. In the meantime, we have no choice but to turn off service to the UK.
Pandora will stop streaming to the UK as of January 15th, 2008.
Again, on behalf of all of us at Pandora, I'm very, very sorry.This is a very sad development for internet radio, and an example of how, yet again, the music industry as a whole seems determined to cut its own throat. No wonder so many people are turning to downloading music through BitTorrent when a legitimate and innovative service such as Pandora which encourages people to listen to new music is targeted by such asinine laws.
However, today has not been all doom and gloom for music lovers. Napster are planning to go DRM-free which is a positive step. DRM makes music-lovers think twice about purchasing music through legitimate channels, and now that Napster have made this move, people may be more willing to go through legitimate channels to obtain the music they love.
I'm not going to go through the reasons why the music industry is slowly strangling itself; it's been done elsewhere by people better informed about the issues than me. However, one thing I do know - singles do not make money (not unless you sell a colossal number of them), they basically act as advertisements for the album. There's no guarantee that they'll break even, since CD's cost the same to duplicate whether they're singles or albums, only the larger cases and inserts make a difference, and what's that, a few pence? So, why not give them away as free downloads? That way you don't take the risk of losing money by printing hundreds of copies that don't get sold. If you are making an album anyway, you've got to pay the recording costs for all the songs on the album. So if you decide to release a single in this manner, it's almost free to release (the only costs being web hosting, which is a few quid a month if you use a commercial web hosting company) and acts as an advert for you. If people can get loads of singles free, they're more likely to try lots of different things, meaning more obscure acts are more likely to be noticed.
Just a thought...let me know what you think!