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Pandora receives final FCC clearance to acquire radio station

pandora and KXMZ canvas newPandora is now legally free to acquire KXMZ, a South Dakota radio station.

Any reader would be forgiven for thinking this is old news. In Pandora’s long quest to acquire an FM radio station, the FCC waived a regulatory hurdle that Pandora had been unable to comply with. That “Declaratory Ruling” happened one month ago. That ruling applied only to the FCC’s normal requirement that radio stations prove no more than 25% foreign ownership.

After waiving that requirement in Pandora’s case, there remained a ruling on a “Petition to Deny” which had been submitted by ASCAP in July, 2013. Today, we know that the FCC has ruled against ASCAP, and made a final acceptance of Pandora’s application to buy the station:

“We find that ASCAP fails to establish a substantial and material question of fact that grant of the Application would be inconsistent with the public interest.  We also find that Pandora is qualified to hold the Station KXMZ(FM) license and that grant of the Application is consistent with the public interest, convenience, and necessity.  Accordingly, IT IS ORDERED that the Informal Objection filed by ASCAP IS DENIED.”

ASCAP’s interest in this transaction is related to music royalty rates collected and distributed to ASCAP clients — songwriters and publishers. Radio stations pay a lower rate than streaming radio does, and Pandora seeks to benefit from being in a different category. The company has also stated its intent to apply its music intelligence technology to station programming.

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Brad Hill

2 Comments

  1. The FCC ruled correctl in this matter, as qualifications to own the station are not determined by side issues like royalties paid out, etc.

    The foreign interest matter is more stockholder related, and since it is a public company, some of that is to be expected in the day-to-day trading on the stock markets of the company’s shares. But the majority of shares are held within the United States, the company was founded in the United States, and their corporate headquarters and principal ownership and management are in the United States.

    The ASCAP petition was a maneuver to delay what everyone knows was inevitable based on all known factors and FCC standards, that Pandora would be able to acquire the station on all pertinent legal grounds and fully according to the rules the FCC set forth in 47 CFR 73.

    I recall the WMCU matter eight years ago in Florida. A popular Christian station went off the air, and after three weeks of dead air the station returned as a classical station which has since proved even more successful. A ‘Save WMCU’ campaign was started and a petition to deny was filed. Five months later the petition was denied on grounds that the matter involved programming. which the FCC takes a clear ‘hands-off’ approach on, and a couple other things, and that American Public Media was qualified to be a licensee (they are associated with Minnesota Public Radio) and given the rich history of that network and its owners and related parties, there was no question there that they were qualified to own what is now WKCP ‘Classical South Florida’. They also delivered on other promises related to programming another station in the transaction and have since been able to expand their network on far south Florida over to the west coast as well as Palm Beach County.

  2. Thanks for the article Brad. For those who live outside US and want to access Pandora radio you can use UnoTelly as I do to get around the geo block.

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