Music falling on deaf ears?

First, Radiohead released their latest album on a pay-as-much-as-you-want basis. Now a top violinist is to release her latest album free of charge.

But then I received an email this morning from Tim Westergren, CEO of Pandora, informing me that their free internat radio service was beiong forced to stop broadcasting to UK-based users:

"As you probably know, in July of 2007 we had to block usage of Pandora outside the U.S. because of the lack of a viable license structure for Internet radio streaming in other countries. We did however hold out some hope that a solution might exist for the UK, so we left it unblocked as we worked diligently with the rights organizations to negotiate an economically workable license fee. After over a year of trying, this has proved impossible. Both the PPL (which represents the record labels) and the MCPS/PRS Alliance (which represents music publishers) have demanded per track performance minima rates which are far too high to allow ad supported radio to operate and so, hugely disappointing and depressing to us as it is, we have to block the last territory outside of the US.

It continues to astound me and the rest of the team here that the industry is not working more constructively to support the growth of services that introduce listeners to new music and that are totally supportive of paying fair royalties to the creators of music. I don't often say such things, but the course being charted by the labels and publishers and their representative organizations is nothing short of disastrous for artists whom they purport to represent - and by that I mean both well known and indie artists.

The only consequence of failing to support companies like Pandora that are attempting to build a sustainable radio business for the future will be the continued explosion of piracy, the continued constriction of opportunities for working musicians, and a worsening drought of new music for fans... There may well come a day when we need to make a direct appeal for your support to move for governmental intervention as we have in the US. In the meantime, we have no choice but to turn off service to the UK."

A very good bit of PR from Pandora, having their CEO release a statement to all of its users explaining what has happened and what they are doing, or trying to do, about it.

But, as Duncan Riley argues:

"The stupidity of the RIAA continues to have little bounds, particularly when a decision like this forces a US company to stop streaming outside of the United States, and yet American owned companies based in the United Kingdom (like Last.fm) are free to stream music anywhere. The RIAA is costing the United States jobs and investment by regulations that will force innovative companies like Pandora in the future to only set up overseas, or never set up at all."

Whilst music artists are leading the music industry into a new and exciting era, innovating new ways of reaching audiences yet still retaining commercial success, it seems that the organisations that govern the music industry and the record labels themselves are failing to adapt to this new era, or at least not being willing to adapt if profits aren't immediately available.

Perhaps rather than losing the business or Radiohead et al to the digital revolution, the bosses of the major record labels need to work with these innovative artists in order to find a way forward.

Add to this that Napster has also joined the move away from copy protected music, isn't it time that the record labels faced the music?

Seth Godin also talks about the collapse of the music industry here.