TOPLINE

because it "publicly touts its financial success." Thanks in part to federal regulations limiting royalty payouts to 11 percent of revenue in 2016, SiriusXM earned $746 million on $5 billion in revenue last year. Pandora, by contrast, spends about half of its revenue on music because its costs are based on usage, while Spotify, whose losses are also ballooning, spends closer to 70 percent. Marks says SiriusXM is fighting to keep paying "below market" rates that are "unfair" to artists and the rest of the digital-radio market. The company contends it pays what is required under federal law. The tension heated up in 2013 when Flo & Eddie, founders of 1960s rock band The Turtles, started filing class-action lawsuits against SiriusXM in various states for not paying royalties on pre-1972 Music's New Best Frenemy: SiriusXM recordings, and the major labels filed their own With Congress set to address pre-1972 copyright laws, labels are lining up against complaint soon after. (Results have been mixed: the satellite radio service — with the two sides preparing to battle over billions SiriusXM paid $210 million to settle with the RIAA, but got The Turtles' New York case dismissed earlier in 2017 while awaiting adecision in Florida.) Industry BY STEVE KNOPPER sources estimate SiriusXM would pay over $1 billion in additional royalties over the next five years if it had fter facing off with Pandora, SoundCloud argued before the Copyright Royalty Board. to pay for pre-1972 recordings, though its settlements and YouTube of late, the music business And now, following SiriusXM's $480 million include some future payments. SiriusXM CFO David has anew No. 1frenemy: SiriusXM. investment in Pandora in June, some label insiders Frear has said that his company should only pay if AThough the 9-year-old satellite radio fear SiriusXM will use its new clout to upend the federal law changes to require everyone to pony up. service has paid record labels and artists hundreds direct licensing deals Pandora inked last summer, Now, the music world is bracing for anew bill that of millions of dollars annually while promoting which led to its on-demand subscription service. would force SiriusXM and other broadcasters to unsigned and emerging acts on its niche music One label executive says that SiriusXM seemed pay royalties for pre-1972 tunes. Likely supporters channels, SiriusXM's relationship with the industry more interested in using Pandora as "a giant free include Pandora, which in 2015 paid the recording has grown more contentious recently. The issues tier to drive their in-car subscription products." A industry $90 million for its use of pre-1972 works. It's between them range from whether SiriusXM representative for SiriusXM declined to comment. unclear where SiriusXM will stand. Butone executive should pay to play songs copyrighted before 1972 SiriusXM "increasingly seems to choose conflict hopes that it will learn from Pandora founder Tim —the subject of an imminent bill in Congress — to over partnership," says Steven Marks, the RIAA's Westergren, ousted as CEO in June, who "realized the rates it should pay for the music on its service general counsel and chief of digital business, it was better partnering with [labels] than trying to during the next five years, amatter currently being adding that the company is getting less sympathy nickel-and-dime them." 0

JAY-Z Charts His Own Path With new album 4:44 expected to become his 14th No. 1title on the Billboard 200, the veteran MC innovates once again — but can others follow his model?

BY DAN RYS

Now that it's almost certain that JAY-Z will June 30 release date. That frustrated fans highest debuts of the year so far — in return to the top of the Billboard 200 in the — Mark Ronson and among its first week available for sale and at all weekending July 13, it's hard to call the them — and, according to piracy analytics streaming services, save Spotify. Bucking rollout of his latest album, 4:44, anything company MUSO, 4:44 was illegally an industry trend, forecasters predict that but a success. But while the Roc Nation downloaded 971,000 times in its first 72 75 percent of those units will be traditional and Tidal boss switched things up again hours. By July 2, Sprint had begun offering album sales. Since JAY-Z owns his masters, for this release, with a Sprint partnership — the album for free to those with apromotion that still adds up to a substantial payday. part of its $200 million Tidal investment in code — earning Jay a platinum plaque from "JAY-Z is in an elite group of entertainers January — and aone-week Tidal exclusive the RIAA — though by then, the buzz that who can market and release that cherry-picked aspects of rollouts by had pushed Tidal up 327 spots to No. 1at aproject this way," says Rlhanna, and Beyoncé, there the iTunes App Store had begun to wane. Marathon Agency co-founder aren't many who could emulate Jay's model. And yet, despite giving away 1 million Karen Chill. "What you JAY-Z's 4:44 Initially, the album was available to copies, an untold number of free Tidal trials have to love about him is he (inset) has already been existing Sprint and Tidal subscribers, but and seeing another 1 million escape to continues to release his work certified (confusingly) only to those who had signed pirates, 4:44 is expected to earn 225,000 in ways that elevate him as an platinuir. up before June 26, prior to the album's equivalent album units —among the 10 incredible businessman." 0 4:44

14 BILLBOARD I JULY 22, 2017