Pandora filed a petition for declaratory ruling that...
Pandora filed a petition for declaratory ruling that it complies with FCC foreign ownership rules, in response to an American Society of Composers, Authors and Publishers objection to its attempted purchase of KXMZ(FM) Box Elder, South Dakota. The request would…
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be the first test of the commission’s relaxed rules for foreign ownership of broadcasters (CD Nov 15 p3), attorneys told us. Pandora agreed to buy the station in June 2014 to qualify for the same publishing royalty rates as broadcasters to match Clear Channel-owned competitor iHeartRadio (CD June 17 p16). An FCC inquiry into Pandora’s ownership was prompted by ASCAP’s objections, leading Pandora to perform a survey of its shareholders, said the company’s petition. SEC policies on shareholder privacy are preventing the company from determining how many shareholders are foreign nationals, and an FCC rule that unknown shareholders should be treated as foreign means the company can’t prove it’s domestically owned, Pandora said. Because of those policies, the commission should permit Pandora to be up to 100 percent beneficially owned by foreign entities and for foreign entities to hold up to 49.9 percent of the aggregate voting authority over Pandora, said the petition. This would be “significantly more restrictive than the approach that the Commission has adopted with respect to common carrier wireless licensees,” and would mitigate historical concerns about foreign influence over broadcasters, Pandora said. Grant of the petition will enable Pandora to become a new entrant into the Rapid City radio market, where KXMZ is located, as well as facilitating the influx of new capital into the market, said the company. It said granting the petition would “bring a new business model to the mature broadcast radio industry, thereby furthering the Commission’s goal of fostering innovation."