4 ms·

For this to be a fair comparison shouldn't they compare the 1 million Pandora streams to (18797 radio plays * number of listeners each time)?

by soupboy 13y ago

deleted 13y ago
[deleted]
- jcomis 13y ago
  It's per quarter, not per month.
  - krcz 13y ago
    I thought it was a radio station named "Terrestrial" and it made number sound incredibly large to me, nevermind.
jedc 13y ago
Exactly. To really be fair you need to compare the audience for each play, and for Pandora/Spotify it's just one person per play versus X (hundred/thousand) for regular radio.
- SomeCallMeTim 13y ago
  Looks like the answer is probably "thousands" [1] of listeners per radio station. The back-of-the-envelope is that the top station will have 1% of its metro area listening at a time (metro areas as defined here [2]). Even the 100th largest metro area would typically have 5k people listening to a play of a track. If you assume 5000 people listening per play at 18797 plays, and then calculate a cost PER LISTENER (at $1373.78 royalties paid) you end up with $0.014617 royalty per 1000 "performances" of the song (counting every listener's radio as a "performance"). AND, when you multiply that back out with the number of "performances" on Pandora, you get....$16.94. Considering WAY more people probably heard the song on the radio, possibly by a factor of 5 or more, this is a HIGH estimate; actually doing the math would likely come out with a much lower equivalence, but it's the right order of magnitude. I am all about protecting artists rights to earn, and for buying music that I'm listening to. As the parallel comment by smack_fu mentions, though, this is really about the insignificance of the Pandora market size more than anything else. That and the inability of a particular blogging artist to do enough basic math to realize the royalty per performance is higher on Pandora than it is on the radio. [1] http://www.radio-media.com/song-album/articles/airplay66.html http://www.radio-media.com/song-album/articles/airplay66.htm... [2] http://www.arbitron.com/home/mm001050.asp http://www.arbitron.com/home/mm001050.asp
  - emn13 13y ago
    Exactly.
  - ronaldx 13y ago
    I have to respectfully question some of your assumptions: Pandora has exactly one listener per track played? 1% of people listen to a popular radio station 24 hours a day?
    - shuzchen 13y ago
      If you follow the links he provides they have actual market data on how many listeners any given radio station has, so his numbers have that behind it. Also, it's not that 1% of people listen to a popular radio station 24 hours a day, it's that at any given point in time, an average of 1% of the population are tuned in to that station. I'd say the Pandora 1 track per customer is a safe assumption. Sure, I've known cafes and dinner parties where Pandora was streaming to multiple people at once, but I've also known lots of friends who have Pandora playing on their headphones even when their headphones aren't on their heads. Nobody I know who uses Pandora actively pauses it every time they leave their computers, so I expect it washes out in the end.
      - ronaldx 13y ago
        You can generalize my point: Pandora should be judged the same way as radio or the comparison is unfair. The methodology of arbitron says that if radio can be identified within audio range, you are deemed to be 'listening' to it. Can we still claim, by this methodology, that every Pandora device has an average of one listener? Only if you claim every radio has an average of one listener by this methodology as well (which is highly doubtful) or if radio and Pandora are used significantly differently (which I don't strongly believe: as you say, it's played in cafes in place of radio).
        SomeCallMeTim 13y ago
        > if radio and Pandora are used significantly differently (which I don't strongly believe: as you say, it's played in cafes in place of radio). I have to disagree: I think the vast majority of people listening to Pandora are doing it on their laptop on headphones, while many radios (today) are not being listened to by a single listener. Regardless, the estimates I used intentionally underestimated the Arbitron radio audience numbers by an order of magnitude. Some of the larger markets go up to 150k listeners on the top station. If you're right and significantly more than 1.0 people listen to a particular Pandora stream on average, then it still have to be more than about 5-10 listeners per instance before it hits the numbers that radio is claiming. And I would be very, very surprised if the average were anywhere near that high. I think if Pandora had evidence of that, they would be able to demand more money from advertisers, for one thing. As to the methodology of Arbitron: Not really relevant for my purposes, because I think that it's accepted by advertisers as reasonable. At some point, if the numbers were complete garbage, the advertisers would have noticed and stopped relying on them; advertisers certainly track the results of their campaigns, after all.
smackfu 13y ago
More than being about fair vs. not fair, this points out that Pandora is a meaningless bit of noise in the recording industry.
anigbrowl 13y ago
No, they shouldn't, because you and I can be both listening to Pandora without hearing the same song. If Pandora played the same songs to everyone, it wouldn't be as popular because people wouldn't hear the music they like. How many more times is this bullshit argument going to be offered up by people who wouldn't be caught dead listening to the radio for this very reason?
- dwaltrip 13y ago
  The artist is complaining that Pandora pays a low royalty rate, and to make this claim they compare to FM/AM radio and Sirius XM royalties. However one "play" on radio or Sirius is equivalent to at least several thousand "plays" on Pandora, as there are many people listening to the radio station (and hence the song) at the same time, while with Pandora it is generally only one or two people listening at a time. So what you really want to compare are the "per listener" royalty rates, which appear to be pretty similar. Say 5000 station listeners * 18797 radio plays = 94M "pandora equivalent plays". If you compare these adjusted play counts to the royalty amounts, radio only pays 30% higher, not 100 times higher. One could make the argument that a Pandora listener should be worth more, as they are choosing to listen to the personalized Pandora station rather than more forcibly listening to whatever the radio DJ puts on. However, the whole debate is obviously not as clear as the OP wishes it to be.
  - anigbrowl 13y ago
    One could make the argument that a Pandora listener should be worth more, as they are choosing to listen to the personalized Pandora station rather than more forcibly listening to whatever the radio DJ puts on. Is that not the whole point of Pandora? If it was the same as radio then what would be your incentive to use it?
    - dwaltrip 13y ago
      Of course that is the whole point. But that doesn't tell us what the royalty rates should be.

For this to be a fair comparison shouldn't they compare the 1 million Pandora streams to (18797 radio plays * number of listeners each time)?

by soupboy 13y ago

For this to be a fair comparison shouldn't they compare the 1 million Pandora streams to (18797 radio plays * number of listeners each time)?

deleted 13y ago

[deleted]

jcomis 13y ago
It's per quarter, not per month.
- krcz 13y ago
  I thought it was a radio station named "Terrestrial" and it made number sound incredibly large to me, nevermind.

jedc 13y ago

Exactly. To really be fair you need to compare the audience for each play, and for Pandora/Spotify it's just one person per play versus X (hundred/thousand) for regular radio.

SomeCallMeTim 13y ago
Looks like the answer is probably "thousands" [1] of listeners per radio station. The back-of-the-envelope is that the top station will have 1% of its metro area listening at a time (metro areas as defined here [2]). Even the 100th largest metro area would typically have 5k people listening to a play of a track. If you assume 5000 people listening per play at 18797 plays, and then calculate a cost PER LISTENER (at $1373.78 royalties paid) you end up with $0.014617 royalty per 1000 "performances" of the song (counting every listener's radio as a "performance"). AND, when you multiply that back out with the number of "performances" on Pandora, you get....$16.94. Considering WAY more people probably heard the song on the radio, possibly by a factor of 5 or more, this is a HIGH estimate; actually doing the math would likely come out with a much lower equivalence, but it's the right order of magnitude. I am all about protecting artists rights to earn, and for buying music that I'm listening to. As the parallel comment by smack_fu mentions, though, this is really about the insignificance of the Pandora market size more than anything else. That and the inability of a particular blogging artist to do enough basic math to realize the royalty per performance is higher on Pandora than it is on the radio. [1] http://www.radio-media.com/song-album/articles/airplay66.html http://www.radio-media.com/song-album/articles/airplay66.htm... [2] http://www.arbitron.com/home/mm001050.asp http://www.arbitron.com/home/mm001050.asp
- emn13 13y ago
  Exactly.
- ronaldx 13y ago
  I have to respectfully question some of your assumptions: Pandora has exactly one listener per track played? 1% of people listen to a popular radio station 24 hours a day?
  - shuzchen 13y ago
    If you follow the links he provides they have actual market data on how many listeners any given radio station has, so his numbers have that behind it. Also, it's not that 1% of people listen to a popular radio station 24 hours a day, it's that at any given point in time, an average of 1% of the population are tuned in to that station. I'd say the Pandora 1 track per customer is a safe assumption. Sure, I've known cafes and dinner parties where Pandora was streaming to multiple people at once, but I've also known lots of friends who have Pandora playing on their headphones even when their headphones aren't on their heads. Nobody I know who uses Pandora actively pauses it every time they leave their computers, so I expect it washes out in the end.
    - ronaldx 13y ago
      You can generalize my point: Pandora should be judged the same way as radio or the comparison is unfair. The methodology of arbitron says that if radio can be identified within audio range, you are deemed to be 'listening' to it. Can we still claim, by this methodology, that every Pandora device has an average of one listener? Only if you claim every radio has an average of one listener by this methodology as well (which is highly doubtful) or if radio and Pandora are used significantly differently (which I don't strongly believe: as you say, it's played in cafes in place of radio).
      - SomeCallMeTim 13y ago
        > if radio and Pandora are used significantly differently (which I don't strongly believe: as you say, it's played in cafes in place of radio). I have to disagree: I think the vast majority of people listening to Pandora are doing it on their laptop on headphones, while many radios (today) are not being listened to by a single listener. Regardless, the estimates I used intentionally underestimated the Arbitron radio audience numbers by an order of magnitude. Some of the larger markets go up to 150k listeners on the top station. If you're right and significantly more than 1.0 people listen to a particular Pandora stream on average, then it still have to be more than about 5-10 listeners per instance before it hits the numbers that radio is claiming. And I would be very, very surprised if the average were anywhere near that high. I think if Pandora had evidence of that, they would be able to demand more money from advertisers, for one thing. As to the methodology of Arbitron: Not really relevant for my purposes, because I think that it's accepted by advertisers as reasonable. At some point, if the numbers were complete garbage, the advertisers would have noticed and stopped relying on them; advertisers certainly track the results of their campaigns, after all.

smackfu 13y ago

More than being about fair vs. not fair, this points out that Pandora is a meaningless bit of noise in the recording industry.

anigbrowl 13y ago

No, they shouldn't, because you and I can be both listening to Pandora without hearing the same song. If Pandora played the same songs to everyone, it wouldn't be as popular because people wouldn't hear the music they like. How many more times is this bullshit argument going to be offered up by people who wouldn't be caught dead listening to the radio for this very reason?

dwaltrip 13y ago
The artist is complaining that Pandora pays a low royalty rate, and to make this claim they compare to FM/AM radio and Sirius XM royalties. However one "play" on radio or Sirius is equivalent to at least several thousand "plays" on Pandora, as there are many people listening to the radio station (and hence the song) at the same time, while with Pandora it is generally only one or two people listening at a time. So what you really want to compare are the "per listener" royalty rates, which appear to be pretty similar. Say 5000 station listeners * 18797 radio plays = 94M "pandora equivalent plays". If you compare these adjusted play counts to the royalty amounts, radio only pays 30% higher, not 100 times higher. One could make the argument that a Pandora listener should be worth more, as they are choosing to listen to the personalized Pandora station rather than more forcibly listening to whatever the radio DJ puts on. However, the whole debate is obviously not as clear as the OP wishes it to be.
- anigbrowl 13y ago
  One could make the argument that a Pandora listener should be worth more, as they are choosing to listen to the personalized Pandora station rather than more forcibly listening to whatever the radio DJ puts on. Is that not the whole point of Pandora? If it was the same as radio then what would be your incentive to use it?
  - dwaltrip 13y ago
    Of course that is the whole point. But that doesn't tell us what the royalty rates should be.