Indie labels strike licensing deal with Pandora

US-based online radio platform Pandora has faced plenty of fierce critcism for its attempts to drive down the royalties paid to songwriters and performing artists in recent years. But today Merlin, the global rights agency for leading independent labels, confirms that it has successfully negotiated a licensing deal with the company.

Merlin said in a statement today that the deal – which applies to Pandora’s business in the United States – will create “new opportunities to build audiences and connect with fans”, and that “while specific financial terms are confidential, the agreement is structured to protect the economics of participating labels”.

As part of the deal, Pandora will accelerate the discovery of new music by combining the expertise of Merlin’s participating labels with Pandora’s data from the Music Genome Project to identify select tracks for additional exposure on Pandora’s playlists targeted to the right listeners.

Merlin’s labels and artists will have direct access to customized metadata and insights, harnessing Pandora’s 75+ million monthly active users, 6 billion stations created and 40 billion pieces of listener “thumb” feedback. By enabling data-driven decisions, Pandora can support Merlin labels and artists across a wide range of business building activities, including selecting cities for a tour schedule, building concert set lists, or choosing a tour partner.

In addition, Pandora will offer customized communication channels for artists on Merlin labels to directly engage their fans and create more intimate connections.

“For the independent sector, internet radio is an increasingly important part of the digital market, and we want to see it continue to grow, and grow fast,” said Charles Caldas, CEO of Merlin.

“For the thousands of labels Merlin represents, this agreement with Pandora provides a real best of both worlds scenario: a hugely important opportunity to increase our members’ revenues and access unparalleled opportunities for exposure, whilst continuing to support a collective licensing framework.”

“This is an important step to advance Pandora’s ongoing commitment to build a vibrant and sustainable music industry,” said Brian McAndrews, CEO of Pandora. “It’s a true partnership that will grow our collective businesses, help artists reach larger audiences and give our listeners an even better music discovery experience personalized to their tastes.”

Merlin’s membership embodies over 20,000 independent record labels and distributors worldwide. According to Merlin, these labels command around a 10% share of the global and US streaming music markets.

“In a rapidly changing marketplace, this is a very exciting opportunity for independents,” said Martin Mills, Chairman of Merlin and of Beggars Group. “It’s a win-win that allows us to continue our strong support for the principles of collective licensing, whilst securing valuable advantages for Merlin’s label and artist community.”

Pandora’s founder Tim Westergren added, “We are deeply committed to harnessing the great potential of internet radio to help musicians of all career stages build their audiences. Independent music has always held a special place at Pandora. These are hardworking artists – many of whom have never received promotion or airtime on terrestrial radio – and their music deserves to be heard.”

“We look forward to the Merlin-Pandora deal,” added Dave Hansen, General Manager of Epitaph and ANTI-. “This is a great opportunity for Merlin’s coalition of independent labels, along with the artists we are proud to represent, to gain additional exposure, increase revenue, and communicate directly to fans, while we continue to support the structure of the current collective license.”

“This new deal will enable Pandora to offer its listeners even more of what they already enjoy. Artists and listeners will benefit from giving extra prominence to independent music,” commented Victor Zaraya, COO, Razor & Tie.

“As an artist driven label we are excited by the Merlin-Pandora deal,” said Billy Maupin, Group General Manager at Yep Roc Music. “Pandora has long been ahead of the curve from a technological standpoint and with today’s announcement they match that prowess with a firm commitment to artists and the independent community alike.”

“I am thrilled to see the Merlin-Pandora deal come together,” said Alan Galbraith, General Manager, Wind-Up Records. “It presents opportunities for all parties and is a real statement from Pandora to the value of independent labels and artists.”Music Business Worldwide

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