Pandora has not shut the door on launching its Internet streaming service in the United Kingdom.

Pandora baulked at going live in Britain following the announcement of new Webcaster royalty rates set recently by Britain's Copyright Tribunal.

The Copyright Tribunal set rates at 0.055p (0.11c) for non-interactive Webcasting, and at 0.085p (0.17c) for interactive Webcasting.

Pandora argues that the rates are incompatible with their business models.
"It is the 0.085p minimum per track that isn't fine. It is totally out of line with the headline percentage gross revenue figure," comments Paul Brown, managing director, international at Pandora Media.

"As we have done from day one in the U.S., we want to pay proper and fair royalties for the creativity that goes into music," he says, "but we cannot launch a business here in the U.K. where music licence royalty rates, particularly where they are based on a per track fee, eat up anywhere between 50%-80% of projected listener hour revenues for even the best ad supported services such as ours."

Brown, however, remains optimistic. "We want to bring Pandora to the U.K.," he says.

Steve Porter, chief executive of British collecting society the MCPS-PRS Alliance, insists that dialog between the parties was essential if an agreement was to be secured.

"We're all busy looking at the Tribunal ruling and how best to implement it and will certainly be talking to services like Last.FM and Pandora to hear their concerns," Porter said. "We have been keen to develop the legitimate online music market since we put our first online licences out there ten years ago and nothing changes that. It is still in our songwriter and publisher members' best interests to have good licensed services out there."

Brown adds, "I very much hope we can work with Steve Porter at the Alliance, as well as sound recording rightsowners to work out a solution to enable us to get going here in the U.K."

The Tribunal set the rates until June 2009 with a view to the fast-moving nature of the business and rapidly-evolving technology. However, its ruling can only be challenged before then on a point of law.