Pandora’s New CEO Says He’ll Continue Pandora’s Old Boss Policies and Getting Richer

The Associated Press story on new Pandora CEO Brian McAndrews starts out on a false premise:

Pandora’s new CEO Brian McAndrews is a rock star of the digital advertising world.

Actually–he’s not. He may like to think of himself that way when he plays air guitar in his bedroom, but he’s not a “rock star”.  But it points out an interesting twist–“rock stars” are hard to find these days, thanks to companies like Pandora.  But the suits–now the suits are the rock stars.  And even if he holds his breath and wishes very hard, Brian McAndrews is a suit.

The Arrogance of the New Boss

So how’s he doing in his capacity as a suit?  Here’s a clue–he has no idea what business he is in and he has no reason to worry because he’s in a protected class, the compulsory licensee, the music profiteer.  The government protects him, forces his suppliers to sell to him at a below-market price through consent decrees or compulsory licenses, and he can outlast any songwriter in court.

And–to our knowledge, Pandora has never been audited.  (And $5 says if you ask McAndrews if he’s been audited, he’ll think you mean by the IRS or maybe by public accountants.)
Are you surprised then that Brian McAndrews’ public message to songwriters and artists is:

The 54-year-old executive told The Associated Press that the royalty fight is “a ways off” and that he’ll rely on the counsel of co-founder Tim Westergren and outgoing CEO Joe Kennedy.

“I’m confident we’ll be prepared and do the right thing,” he said.

“I do share Pandora’s longstanding belief that musicians should be fairly compensated for their work,” McAndrews said, adding that the existing patchwork of laws was “created piecemeal over decades” and “doesn’t serve any one very well.”

Well, as the company’s stunts and litigation tactics this week demonstrate, Pandora’s “long standing belief” is that songwriters and artists should be jammed down as hard as humanly possible with the help of lobbyists and lawyers in ways that the “old boss” wouldn’t have dared to do.
While at the same time bringing their 2nd IPO to market and putting over $300 million in the company’s coffers.  To bonus songwriters and artists for sticking with them in the bad times?
Oh no.  For acquisitions.  And probably to cover Brian McAndrews salary, which I for one think he should disclose, don’t you?  If Pandora says they are not making enough money to pay fair royalties–but they are making enough to do a second IPO–then maybe they need some help from songwriters in how to make those precious dollars last longer.
That’s certainly something that songwriters know something about.
But as the AP reports, let’s not hear anymore poor mouthing and handwringing from “Million a Month” Tim Westergren about how Pandora is not going to make it unless artists and songwriters take less:

What’s different about the upcoming fee negotiations with SoundExchange is that Pandora’s survival is no longer in doubt. Analysts expect that in the fiscal year through January, Pandora will post its first positive earnings per share — 3 cents after excluding special items — since it became a publicly traded company in the summer of 2011.

For more on the second Pandora IPO see Andrew Orlowski’s great article, “Tightwad music spaffer Pandora opens box for Wall St to fill with cash“.