F*&k It: Here’s the Entire Apple Music Contract for Indies…

On June 30th, Apple will be launching its streaming service, Apple Music.  This is the contract that independent artists and labels are being asked to sign, including a clause that allows Apple to pay nothing to rights holders during a three-month, introductory tier.

51 Responses

  1. chuck

    If an indie artist chooses not to be on Apple Music Streaming, can the artist still be on iTunes? I am hearing no.

    Reply
    • Anonymous

      Yes, Apple has not threatened to remove content from the iTunes store if you don’t sign the streaming deal

      Reply
    • Anonymous

      “can the artist still be on iTunes?”

      And then there’s the other question:

      Does s/he wants to?

      Reply
      • Anonymous

        And then there’s the other question:
        Does s/he wants to?

        uh… No one is forced to be on iTunes, or any legal music store for that matter.
        Are you new to the internet ?

        Reply
      • Anonymous

        …here’s why Taylor Swift’s 1989 won’t be streamed on Apple Music:

        “We don’t ask you [Apple] for free iPhones. Please don’t ask us to provide you with our music for no compensation.”

        SOURCE: Taylor Swift, tumbl

        Reply
    • Anonymous

      “If an indie artist chooses not to be on Apple Music Streaming, can the artist still be on iTunes? I am hearing no.”

      I’m afraid you may be right — here’s what Anton Newcombe, Brian Jonestown Massacre told Billboard (I’ll post link in a separate comment below):

      “[Apple] has a new deal they offered me: they said we want to stream your music free for 3 months..I said what if I say no, and they said ‘we’ll take your music off itunes.”

      Reply
    • john matarazzo

      Where does this leave an indie label that is distributed through and aggregator like The Orchard (SONY)?

      Reply
  2. Anonymous

    “On June 30th, Apple will be launching its streaming service, Apple Music”

    That remains to be seen.

    Thanks for the articles, Paul. They haven’t been pleasant reading for Apple fanboys like me, but they were necessary.

    I’ve always liked PCs, but I loved Mr. Jobs from the first time I saw him; I loved everything Mac from the first time I touched a mouse, and I’ve used most or all of their products in my work, hard and soft.

    But Mr. Jobs has left the building.

    And he’s not the only one.

    Reply
  3. Anonymous

    Everybody, save that contract… 🙂

    Apple takes (its own) Intellectual Property very seriously.

    Reply
  4. Tim Crook

    Dear COMPANY,

    By clicking to agree to this Digital Music Download Sales Agreement, which is hereby offered to COMPANY by ITUNES (as those terms are defined below), COMPANY agrees with ITUNES to the terms and conditions set forth herein, and you personally represent and warrant to ITUNES that you are authorized to electronically sign this Digital Music Download Sales Agreement on COMPANY’s behalf.

    ITUNES may create, distribute and monetize unauthorized copies of COMPANY’S entire catalog without permission and otherwise rape COMPANY 24/7 without compensation.

    ——————––
    Sincerely yours,
    Tim Crook

    Reply
    • Sigmund

      @Tim Crook : YOU NEED TO LAY DOWN ON THE HARD DRUGS AND CHILL DOWN. AND CONSULT YOUR PSYCHIATRIST MORE OFTEN

      Sincerely Yours.
      Sigmund Fraud.

      Reply
      • Jeff Robinson

        “Tim Crook”?

        Bwaaaaahaaahaaahahahahahaaaaaaaaaaaahaahahahahaahahaaahaahahaaaahahaahaaaaa

        har

        Reply
    • David Smith

      The big major companies always rob us little people the punks ass major labels sign artist that already created a buzz for themselves also wrote all of the lyrics and paid for the production and the major company comes in and rape us for our live performance revenue, Publishing, merchandise, Digital revenue, name and likeness, TV

      Reply
  5. Chris Mchale

    Streaming is financial suicide for musicians. Apple, Spotify. Pandora. Whatever. No one will ever make any money from streaming. Bottom line.

    Reply
  6. Sam

    For 3 months, apple is going to pay us ABOUT the same amount that Spotify pays us all the time.

    Fuck ’em both, but the 3 month thing is the least of anyone’s problems. Shitty? Yes. But not compared to the companies that proudly proclaim they will never pay anything, wear it as a badge of “honor”, and dedicate their lives to trying to pay us less.

    Reply
    • Sigmund

      Why would anybody sign a contract like this?

      For the same reasons people sign even worse contracts with Spotify and Google’s Youtube ?

      Reply
  7. Headlines

    Recent headlines:

    Apple Music Streaming Service Terms Dismay Indie Record Companies — New York Times
    Many Indie Labels May Refuse to Sign Apple Music Contract — Rolling Stone
    UK Indie Labels Say Apple Music Free Trial Could ‘Literally Put People Out of Business’ — MacRumors
    Bon Iver criticises Apple’s new streaming service — The Guardian
    Apple no-pay-for-plays streaming risks indie boycott — The Register
    Independent record labels say Apple is trying to put them out of business — Fortune
    Apple Music Slammed By Beggars Group, Home Of Pixies, Adele, Radiohead, Other Indies — Ibtimes

    Reply
  8. Alice Enders

    Thank you Paul for an amazing find including the terms for minimum wholesale sub prices to labels varying from $5.80 (US) to $2.89 (Latam), $3.47 (Caribbean), and Mexico ($3.78). iTunes dictates retail prices, and has announced $10 for the service so 58% of that amount is wholesale to the labels. On top are performance and mechanicals and any other charges for content, so perhaps it’s true that 72% of retail will be transferred to rightsholders.

    Reply
  9. Dan

    Having a 3 month free trial with no royalties is NOTHING NEW. Every Spotify, Deezer, MixRadio, Rdio, Google Play contract has a similar clause – rights holders routinely sign these

    What Apple are being fucks about is that the above free trails were for new services to help kick start their growth.

    Apple already has millions of customers (and lets not forget billions in the bank) so they don’t have to spend a dime getting new customers so they should pay for those trial months

    Reply
  10. Help Please!

    HELP! Exhibit K (Radio Service), Section 1(o)…Page 45.

    “”Royalty Bearing Performance” means each Performance of an individual sound
    recording through the Radio Service, excluding: (i) up to six (6) Performances of
    individual sound recordings which are not rendered for more than twenty (20) seconds in
    duration each (i.e., skips), per Listener per hour per channel or station; (ii) up to two (2)
    Performances per Listener Hour (measured in the aggregate across all Listener Hours in a
    given month) where the Performance is either (A) of Listener Matched Content, (B) a
    Complete-My-Album Play, or (C) a Heat-Seeker Play; and (iii) any Performances to
    Listeners who are Cloud Service Users.”

    Everyone, please review the conditions for streams that you will NOT get paid on. Especially the last exclusion which (iii) says ANY streams to listeners who are Cloud Service Users DO NOT COUNT AS ROYALTY BEARING PERFORMANCES!!!!!!

    Reply
      • Anonymous

        Yes – basically their Pandora mode…except Apple is not paying.

        Reply
    • Anonymous

      “Everyone, please review the conditions for streams that you will NOT get paid on”

      The opposite would be easier.

      Reply
    • Tim F.

      This seems very reasonable to me. It’s actually a very small carve-out covering two categories: 1) skips/songs you don’t actually listen to even if a stream has begun. This is CAPPED at SIX songs per hour. 2) songs that are technically streamed but are the closest thing to “owned” in this modern age, which if it had been 5 years ago wouldn’t have yielded a performance royalty anyway. This is CAPPED at TWO songs per hour. That is, even though many would argue that digital downloads, or iTunes Match, or personally-owned Cloud-stored music isn’t properly owned Apple is trying to make the terms and limits of this music seem as if it is owned and is recognizing that some music listeners who do seek ownership still want the benefit of streaming without crafting their own playlists. That is, if I “own” the music of x artist and could play it back at any moment or create a playlist for it, why should I (or rather the provider) be paying a PERFORMANCE royalty simply because selecting a streaming playlist is more convenient than not and because our current rights laws are based on radio waves and the state of affairs in the 1950’s?

      This seems like a great benefit to the consumer and, at worse, the loss of hundredths, perhaps thousands, of pennies to the producers (remembering that the same music was either purchased, already a part of the consumer’s library from whatever legal or illegal source anyway, and/or paid through existing contracts governing iTunes Match and other services).

      Reply
  11. Help

    BTW- Apple’s iCloud is free to all users, everyone automatically gets 5 GB of free storage.

    Therefore, it stands to reason that most users will be “Cloud Service Users”. Which according to the Agreement means all streams (performances) to those users will not count as Royalty Bearing Performances.

    IN SHORT, APPLE IS NOT GOING TO PAY YOU ANYTHING EVER…

    Reply
    • Anonymous

      Please stop trolling. You’re an idiot and you have absolutely no clue about anything. You’re just pollutiong this website with your idiotic posts.

      Reply
      • Who is the troll?

        Anonymous,
        Why would you want to shut down the exchange of opinions and important information? People on this site care about the value of music and use this forum to have an open discussion. Apple’s contract terms seem pretty clear. However, please explain exactly what you take issue with?

        Reply
        • Anonymous

          +1

          —————————————
          🙂 The real Anonymous 🙂

          Reply
        • Tim F.

          Speaking for myself, I don’t want people spreading idiotic misinformation like “APPLE IS NOT GOING TO PAY YOU ANYTHING EVER…” either. It’s wrong, foolish, ignorant, and is not additive but rather heavily subtractive and divisive towards meaningful, useful, and informative discussion.

          Reply
  12. Anonymous

    Just to compare Apples to Apples. Below is Spotify’s definition of “Royalty Bearing”

    “Royalty Bearing Play” means any Stream or playback of a Cached Download of an item of audio or
    audio-visual content (excluding Streams or playbacks of Local Files, advertising and permanent audio
    downloads purchased from the Service) via the relevant Service (or part thereof) with a minimum duration of
    thirty (30) seconds.

    Suddenly Spotify doesnt seem so bad and Pandora is actually “very generous” with its payments on all streams.

    Reply
    • Tim Wood

      So does Apple Music signal a new “race to the bottom,” where Spotify, Pandora, etc. cite “competitive pressures” as an excuse to lower artist/label/publisher payouts? Hard to see Apple Music as anything but cynical.

      Reply
      • Ted Zed

        Sure looks like it.
        These leaked contracts are a major concern. As many know, in the US, statutory rates are set by the Rate Court’s determination of a “reasonable” rate based upon “what a willing seller and buyer would negotiate in an arm’s length transaction”. In digital music, the terms of these transactions have been highly confidential…. until now.
        If the rate court views the Apple and Spotify agreements as industry “benchmarks,” then one could expect statutory streaming rates to go down…significantly.

        Talk about a race to the bottom for sure.

        Reply
  13. Anon

    I have notified my aggregator that I will not opt in to Apple Music. They’re wishy washy response was they don’t know what the agreement will be blaa blaa blaa. I don’t do spotify or any other streaming service either, although the aggregator keeps ‘slipping’ up and adding things to spotify, deezer etc (i have around 25 albums on itunes) It seems to me Apple and the agregator are in breach of contract if they either do a take down, or if they put the content on Apple Music without my express permission.

    Reply
    • Anonymous

      “They’re wishy washy response was they don’t know what the agreement will be blaa blaa blaa”

      I can hear from the response that your aggregator is Tunecore. 🙂

      Don’t worry, I asked Distrokid and they allow us to opt out. You’re even going to save a bit of cash in the process if you’ve got 25 albums; I think Distrokid charges something like $20/year for unlimited iTunes songs.

      But I’d also pay attention to the upcoming iTunes- and YouTube alternative RepX if I were you.

      Reply
  14. Satan

    What if Apple tried the opposite approach as far as paying licenses, suppose they offered three months free AppleMusic to customers AND at the same time told all major labels, independent labels and music publishers that they will pay 100x the highest royalty offered by Pandora, Spotify, YouTube etc. Apple can certainly afford it.

    Do you know what would happen?

    Every Fed antitrust lawyer and every state AG would file an investigation into Apples monopoly power grab.

    Maybe Apple is behaving just like all of the other digital streaming services who are paying nothing or next to nothing because that’s the business they are in and anything slightly friendlier to content providers will be inviting lawyers to subpoena their books.

    Just speculating none of this is necessarily so

    Reply
  15. Manny

    Very interesting that, according to that contract, Apple seems to think that Mexico (and the Carribean for that matter) is not part of Latin America.

    Reply
  16. john matarazzo

    I contacted my aggregator, The Orchard. They’re not talking. My rep keeps saying that they will get back to me with details after the launch. I have over 250 albums with them and all I get is bu%*%$

    Reply
      • john matarazzo

        Nope. Everybody’s playing dumb. Less than 2 weeks to launch and they want me to believe that they don’t have a deal in place. I guess they think I’m a mushroom.

        Reply
        • Anon

          Then they are lying through their teeth. Routenote was lying to me too, until I threatened them with court, then it was ‘oh we just found out you don’t have to opt in’ Blaa Blaa.

          Worst case, switch aggregators and bill them for expenses. It is on them if they are changing the terms you signed up for.

          By the way, with 250 albums wouldn’t itunes connect be better, if you qualify ?

          Reply
  17. Musicservices4less

    As to the question of can you opt out of Apple Music streaming service and still keep your masters on iTunes, I am advising my clients that in business terms, you CANNOT. And here is why. All my label clients have been noticed with the same exact contract DMN has posted. All these clients have direct deals with Apple.
    This contract MUST be signed and, unless you are one of the very few major independents, you have no ability to change those terms, at least not within the next 3 months. While not confirmed yet, it is my opinion that the Apple iTunes legal department will take the position that whether or not a label has signed that new contract, ipso facto, rabbit up my sleeve shit, the new contract went into effect on July 1, 2015. So in the fall they will get back to you and say “Sure, you are welcome to terminate your relationship with Apple (both iTunes and Apple Music) and you know what, we’ll even agree to make it effective AS OF JULY 1, 2015.” Isn’t that what you asked for? Oh and of course any “sales” that occurred after July 1, 2015 we will account and pay you for. BUT UNDER THE NEW AGREEMENT IN EFFECT FOR ALL APPLE LABELS INCLUDING THE MAJOR LABELS. So how can you argue with that, you’re getting MFN with major labels FOR SALES DURING THAT SAME PERIOD? Aren’t we (Apple) nice? Oh, by the way, if you disagree with what we are doing with you, SUE US (APPLE).
    19. Termination of Any Prior Agreements. If the Parties have previously entered into any Digital Music Download Sales Agreement or Digital Video Download Sales Agreement, covering the distribution of music and/or music videos, that is in effect as of the Effective Date and the territory of which includes any part of the Territory (each a “Prior Agreement”), the Parties hereby terminate each such Prior Agreement as of the Effective Date.

    For more insight as to what is really going with Apple and any other matters effecting the music business, email at [email protected] There is a reasonable fee for advice and consultation.

    Reply
  18. Dub Gabriel

    70-90% of digital sales a artist receives is from I-tunes. It’s decision to switch to a streaming service will not only put the final nail in the coffin of record sales, they choose to hold artist hostage with no other option. They have decided a self imposed 3 free month trial where artist and labels will not be even paid for the streams in it’s peak time of discovery. You have to understand, Independent artist and labels who press vinyl are not doing to just follow a trend, but for survival. Bandcamp, artist websites and independent record shops are the only true resource to truly support the craft of recorded arts. People like to think that artist can just survive off of playing out, but that is a whole other dilemma of regional promoters, clubs, venues and underground parties being blocked out and monopolized from by corporate backed mega festivals. Music, like other art mediums needs to be respected into our culture to all that it gives. My personal feeling, streaming services is like looking at a jpeg of a Vincent van Gogh. But beyond the argument of what is best for music delivery, we must look at it as a social responsibility. It helps create our identity and takes us on journeys of new perspectives. Support culture in our society, not marketing on the back of recording artist everywhere to sell more iphones. Apple doesn’t care if profit is made from streaming as long as they can keep selling you the phone.

    -Dub Gabriel
    Destroy All Concepts

    Reply
    • Tim F.

      Apple may represent 70-90% of digital download sales for musicians, but streams dwarf downloads nearly 98% to 2% and even though streaming revenues are paltry, download revenues versus streaming revenues is 65% versus 35% already… this is not mentioning all other sources of revenue to musicians. Revenue solely from digital downloads versus all revenues available to musicians is very small. 70-90% of it is not that significant when that 70-90% slice is coming from a 15-20% slice to start. Apple’s digital download business is plummeting at a 13% annual rate whether or not they convert to a primarily streaming model.

      Caring and social responsibility have little value if it’s in complete denial of economic and technological reality.

      Reply
  19. T-Swizzle

    We still need Taylor to fix Apple’s non-interactive radio payments (e.g. Pandora-style). As noted above, if a user is part of Apple’s iCloud, then per Exhibit K (Radio Service), Section 1(o) of the Apple agreement any streams to that user are considered “Non-Royalty Bearing”.

    Since most of Apple’s users are using iCloud (whether they know it or not), Apple will not be paying for the majority of their radio streams.

    Reply

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