Seeking Alpha

DOJ investigating possible collusion against Pandora

  • The DOJ has sent out document requests to music publishers Sony/ATV and Universal, as well as trade groups ASCAP and BMI, regarding the consent decrees through which they provide performance rights to Pandora (NYSE:P) and others.
  • The agency is investigating allegations of "coordination" between the publishers and trade groups to secure higher royalties. The probe comes after Pandora alleged during a 2013 rate-setting trial (previous) the parties colluded to change ASCAP/BMI by-laws that would allow for partial rights withdrawals, a move that paves the way for higher royalties.
  • During the trial, Judge Denise Cote found proof of "troubling coordination" between ASCAP, Sony, and Universal, but had no jurisdiction on the matter to make a ruling.
  • Content acquisition costs accounted for 56% of Pandora's Q1 revenue, with recording royalties (different from performance royalties) making up the biggest portion of the total. Q2 results are due on July 24.
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Comments (3)
  • manicdvln
    , contributor
    Comments (800) | Send Message
    The only collusion thats going on is Wall St bankers pumping this garbage from 5$ to 40$ on no fundamental change.


    I don't know how you add 6B+ market cap to a company that has quarterly losses over a decade and slowing growth rate.


    Sounds familiar to CYNK.


    This is next for Pandora.
    14 Jul, 05:06 PM Reply Like
  • shai.tha
    , contributor
    Comments (13) | Send Message
    Current run up and the one before are all attributable to retail investors (who buys 50, 100, 125, etc. number of shares). There has been no Institutional selling in last several days. Volume is very thin too.


    Now it is true that some of the analysts are responsible for higher price target.


    While I am not sure from $5 to $40 argument, I can tell you that nothing had changed since it was fallen to $21.47. Meaning since then till now it is fully inflated. But guess what? Watch few days and you will see lower price....
    14 Jul, 05:28 PM Reply Like
  • dgulick
    , contributor
    Comments (1562) | Send Message
    Here's one opinion (which are very much based on Cote's findings)


    With this as a backdrop, reading between the lines of some of the comments in the billboard piece:
    "I am sure it [the investigation into whether there was coordination among publishers] is routine, " says one top music publishing industry executive. "I can't imagine anything coming from it."


    Wow -- just a bit of denial? This stuff will make a good book someday.
    7 Aug, 01:03 AM Reply Like
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