Update: Pandora Cleared to be Broadcast Licensee

Terse compliance plan does the trick, although Pandora still has some hoops to jump through.

The good folks of Box Elder, South Dakota can breathe a little easier now. Soon they should be able to listen to their local radio station and not have to worry about insidious alien influences. (If they get their tunes through the Internet, however, they're on their own.)

As we reported last month, Pandora, in an effort to reduce its copyright royalty costs, has been trying for a couple of years to purchase the only radio station in Box Elder. But that got Pandora mired in FCC red tape, as the Commission tried to determine whether Pandora complied with foreign ownership restrictions. The way was finally cleared in May, when the FCC agreed to consider Pandora's application subject to a number of conditions. (Check out our previous post for details.) At that time, the Commission held off on actually granting Pandora's application until at least some of those conditions were satisfied.

That has now happened: the Media Bureau has finally approved the assignment application, clearing the way for Pandora to become a radio station licensee.

To garner the Bureau's approval, Pandora submitted a "compliance plan" detailing steps it would take to periodically measure its foreign ownership and ensure that it did not exceed the levels approved in the Commission's May decision. "Detailing" might overstate things a bit, since the compliance plan (available here) came in at barely a page and a half. But it was apparently enough to satisfy the Bureau, despite the continued objections of ASCAP.

In the plan, Pandora outlines some of the steps it will take to monitor its foreign ownership, and commits to certifying compliance with the terms of the Commission's May Declaratory Ruling beginning with its 2017 biennial ownership reports. (Pandora argued, successfully, that it would not be able to compile the necessary information in time for the filing of its 2015 ownership reports.)

Among the monitoring steps it will take, Pandora has pledged to try revise its organizational documents to allow it to require shareholders to divulge their citizenship. Those revisions will require shareholder approval, and Pandora's 2015 shareholders meeting was already scheduled for June 4. Because of that, the Bureau agreed that Pandora can deal with this provision at its 2016 shareholder meeting. If Pandora's shareholders reject the changes in 2016, the company will have another chance at getting them approved in 2017. If they are rejected again, the Media Bureau intends to require Pandora to divest the station.

So Pandora still has a number of steps it needs to take, but at least for the time being, it has been deemed fit to become a Commission licensee. According to the transactional materials already filed by Pandora, barring any revisions we can expect closing sometime this month. If that occurs, Pandora will actually, finally, after almost two years of waiting, become the proud owner of a terrestrial broadcast radio station. We hope it turns out to have been worth the effort.