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​Pandora Is Paying Artists $0.0001 More Per Stream Than Last Year

The company revealed this week that its performance royalties have increased by 8 percent year over year.
Image: Pandora

Since January 1, Pandora has been paying artists marginally more each time their song is played on the music streaming service, according to a recent report.

Pandora's royalty payments to SoundExchange, a non-profit performance rights organization that represents artists on its site, have increased by 8 percent in the last year, Music Business Worldwide reported Sunday, per a Pandora call with investors. But on a song-by-song basis, it doesn't amount to much.

The company now pays $0.0014 per stream for its standard service, up from $0.0013 in 2014; and $0.0024 per stream on its premium, ad-free service, up from $0.0023 in 2014. The increase is part of an ongoing increase in fees charged by SoundExchange. Early last year, Pandora said SoundExchange had increased its royalty fees 53 percent since 2009.

The increase in per-stream rates comes as musicians are continually more vocal about the low rates offered by streaming services like Pandora and Spotify. In November, artist Aloe Blacc wrote in an opinion piece for Wired noting that "Wake Me Up!", a song he co-wrote and sang that was streamed 168 million times on Pandora in the US, yielded him only $4,000. Last year, Taylor Swift pulled all of her albums from Spotify, saying she didn't think the company fairly compensated the creators of the music it streams. Jay Z said he would usher in "a whole new era" for the music industry with his new streaming service Tidal, which launched in March and offered artists higher returns for their work.

The 2015 rate for SoundExchange royalties is $1,400 per million plays on Pandora, but the site has yet to come to a decision on rates for 2016 and beyond. SoundExchange proposed a significant increase, with a new fee of $2,500 per million plays, while Pandora has countered with a rate starting at $2,150 per million spins, per the Motley Fool.

On Monday, Pandora and several other internet radio sites took their case case to the Copyright Royalty Board, a federal body that sets royalty rates for internet radio broadcasts. The Copyright Royalty Board is expected to release a decision in December 2015, according to RAIN News.