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Pandora and Paul Williams: Lots of Bark, but How Much Bite?

Stocks in this article: P SIRI AAPL

Williams' response: No. Songwriters are not venture capitalists. They're people who work day jobs to pay the bills and create music at night (like the guy Williams recently met, who was serving samples of granola at Whole Foods, or Williams' conception of the woman wearing headphones laying down tracks while her baby naps beside her).

This is my interjection, not Williams' words: Songwriters and composers do not have the same opportunities performers have to monetize their work in more wide-ranging ways. I have brainstormed on how the pure songwriter (as in, he or she does not double as a performer) can make money beyond royalties and ad revenue sharing. I can't come up with many. And the ideas I do have provide no guarantees.

As I muse about being more "visionary," Williams returns to his original point: ASCAP represents songwriters and composers. That's where our interest lies. We're focused on nothing but ensuring the people who license the content they create receive a fair rate for their work across platforms.

The more I research and write on this issue, the more I think I see how it's going to end. My meeting with Williams didn't artificially influence or persuade me (I have checked myself on this countless times in the last week or two) as much as it confirmed the trajectory I felt like I was on all along.

Pandora makes the most compelling argument on the performance side. The songwriters, at least as articulated by Williams, make the most compelling argument on the publishing side.

As the chart from Page One of this article suggests, there's as much disagreement between performers and songwriters as there is between either group and Pandora. But that's a discussion for another day -- how the total pie gets divvied up between the two parties and subsequent sub-parties at the time of payment and at the point of distribution.

For Pandora's fiscal year ending Jan. 31, 2013, the company paid 55.9% of revenue to SoundExchange for performance royalties and about 4.7% in non-SoundExchange royalties (payments to songwriter/publisher groups).

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