Pandora Media Inc. is paying $90 million as part of a streaming music settlement and the company has agreed to start paying royalties for songs recorded before 1972 as the service looks to the future.
The internet radio giant agreed to the settlement after it was discovered that Pandora was using recordings made before 1972 without paying royalties for those streams.
Federal copyright law didn’t start protecting sound recordings until 1972 and older tunes are covered by various state laws that very from one region to the next.
Several years ago Pandora stopped paying royalties on pre-1972 music. The company said in the past that such songs account for less than 5% of music the service plays.
In 2014 the Recording Industry Association of America (RIAA) sued Pandora at the state court lvel in New York.
The RIAA had previously sued SiriusXM for the same reason. In June SiriusXM agreed to pay $210 million and agreed to negotiate new licenses for the oldies tunes.
The $90 million settlement will see payments going to Vivendi SA’s Universal Music Group, Sony Corp.’s Sony Music Entertainment, Access Industries’ Warner Music Group and ABKCO Music & Records.
$90 million accounts for approximately 10% of Pandora’s annual revenue.
Pandora must now seek out special licensing agreements if it wants to continue offering pre-1972 music recordings.