The following video is from Friday's installment of The Motley Fool's Weekly Tech Review, in which host Chris Hill and analysts Eric Bleeker and Jason Moser look at the biggest stories driving the tech sector this week.
Streaming Internet radio provider Pandora (NYSE:P) has been clashing with artists recently over the amount it pays them to use their content. Artists such as Pink Floyd have penned widely read editorials criticizing the size of the paychecks artists are receiving for the millions of streams of their songs on Pandora. The company has fired back, noting the wide disparity in the percent of revenue it pays to artists relative to terrestrial radio or Sirius XM (NASDAQ:SIRI). Currently, Pandora pays roughly half of its revenue in song royalties while terrestrial radio pays out closer to 1.7% of its revenues. Convoluting matters is that the recent announcement of iTunes Radio included per-song rates that were slightly higher than what Pandora plays.
In this segment, Jason and Eric discuss Pandora, whether or not its payments to artists are unfair, and what the endgame is for Pandora as it aims to stay competitive against new streaming services, such as the one Apple (NASDAQ:AAPL) is launching.
The full video is available here.
The relevant video segment can be found between 4:46 and 8:10.
Chris Hill, Eric Bleeker, CFA, and Jason Moser have no position in any stocks mentioned. The Motley Fool recommends Apple and Pandora Media and owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.