While I’m not a big fan of Last.fm because their bloody software starts up on my computer without my permission, I am a fan of their concept, as well as a regular listener of Pandora. Both are streaming music recommendation sites, and very popular, if you judge by just Google PageRank and Alexa.
Unfortunately, a panel of copyright judges are ordering Internet radio stations like them to increase the royalties they pay to musicians and record labels. And for relatively young startups like them, the ruling means likely extinction. Pandora founder Tim Westergren, of course, thinks the decision sucks.
I’m inclined to agree but primarily because it means less diversity of music online, and an advantage for terrestrial radio stations. Without getting into too much detail, I’ll say that as a former community radio co-host and producer, I know for a fact that terrestrials don’t always pay all of the royalties an act is due. This is because of the way playlist data is analyzed at royalty payment time. At least in Canada, and at least the last time I checked, about 5 years ago. If this holds true for the United States and other countries, then Internet stations have a disadvantage since it’s relatively easy to determine the entire playlist and thus payable royalties.