Purchases radio station in the US.

Online radio and music streaming service Pandora has purchased KXMZ ‘Hitz 102.7FM’, a small broadcasting station in South Dakota, formerly owned by Connoisseur Media, at a cost of $600k.

Pandora bought the station to qualify for a Radio Licensing Marketing Committee (RMLC) license that would reduce the amount of royalties the company needs to pay.

Pandora’s Assistant General Counsel Mark Harrison confirmed this yesterday saying: “This acquisition allows us to qualify for the same RMLC license under the same terms as our competitors”.

Harrison is a member of Counsel representing Pandora in its legal battle with the American Society of Composers, Authors and Publisher (ASCAP), and is alleging there has been “discriminatory treatment of PANDORA and other Internet radio companies by ASCAP and their publishing industry members”. 

The legal proceedings come after ASCAP signed a deal in January 2012 with the RMLC and other Performance Right Organisations, such as BMI, that would impose a blanket license fee of 1.7% of a licensee’s gross revenue, with a standard deduction of 12% of revenue for broadcast stations and 25% for internet webcasters. 

Pandora’s next step is to develop programming for the new station, which currently has an ‘adult hits’ format. Harrison says the company “will apply Pandora’s insights and listening habits to program music that accurately reflects local listeners’ evolving tastes”.