Pandora's chief executive Brian McAndrews seems to be OK with the price increase, though. In a statement, he said: "This is a balanced rate that we can work with and grow from. This decision provides much-needed certainty for both Pandora and the music industry." The ones who sound unhappy with the decision are the music labels, which wanted a much, much higher royalty hike.
Record label representative SoundExchange was pushing for a heftier 25 cents per 100 song plays, causing Pandora investors to panic. The company's stocks plummeted before the Royalty Board's decision came out, and then it rose by 22 percent during after-hours trading. SoundExchange's spokesperson told The New York Times: "It's only fair that artists and record labels receive a market price when their music is used. We believe the rates set by the C.R.B. do not reflect a market price for music and will erode the value of music in our economy." The group says it will review the decision and consider its options, which means it'll likely continue to demand a higher royalty rate. Hopefully, that doesn't translate to more expensive monthly fees for Pandora One in the future.
[Image credit: Denise Truscello/Getty Images for Pandora Media]