Breaking: Apple Agrees to Pay All Artist Royalties During Free Trials…

It started with a leaked contract on DMN, and culminated with a high-profile pullout from Taylor Swift.  Now, the biggest corporation in the world caving…

(Eddy Cue = Apple senior vice president of Internet Software and Services)

 

cuecaves

72 Responses

  1. Anonymous

    Conspiracy theory:

    Taylor Swift received a nice fat check back in September/October 2014, followed by her pulling content from Spotify, and what we’ve just witnessed is the final step in a well orchestrated PR campaign. Bad, bad, Apple – Oh you’re our hero!

    To quote Miss Swift’s post:

    “I hope that soon I can join them in the progression towards a streaming model that seems fair to those who create this music. I think this could be the platform that gets it right.”

    How does a company get it right when they are copying EXACTLY the same business model and price points? Artists can’t be better off with a copycat.

    It would have been more genuine if Apple had responded to everyone else who complained. Goes to show that independents don’t matter.

    Reply
    • Fuck Apple!

      Your conspiracy theory is beyond ridiculous, no company would do that to itself.

      Apple is now industry enemy #2 — extremely close behind Google — and it’ll never be able to repair the damage.

      Reply
    • Anonymous

      Wait, let me guess: you work for either Google or Spotify. Or both.

      It must suck to watch your company circle the toilet bowl before your very eyes tonight.

      Apple listens to artists.

      Reply
        • Edward Jennings

          Taylor Swift is not with the press. She is a music artist.

          Reply
          • Anonymous

            Apple doesn’t listen to Ms. Swift.

            Apple listens when New York Times print Ms. Swift’s letter.

          • Anonymous

            More like they listen to the millions of fans who would follow Swift off a cliff if it meant they could catch a glimpse of her. If Swift’s not happy, those fans are not happy. And those fans buy Apple products.

          • jdrefahl

            Do you really think Taylor Swift is writing these position papers? Seriously?!?!

      • Anonymous

        If Apple listens to artists, how is it possible that they ever went public with this demand that artists subsidize the free trial in the first place?

        If Apple does listen, this term was a big “fuck you” that Apple just thought it could get away with.

        I think where Apple miscalculated was in assuming that independents would just suck it up. Instead, labels and artists stood their ground and Apple backed down. Hopefully that’s the start of a trend and a message to all the other platforms that rely on content from artists.

        Reply
        • Anonymous

          “Hopefully that’s the start of a trend and a message to all the other platforms that rely on content from artists”

          Yes!

          But we need to simplify the following algo and decrease the time it takes to go from a to g:

          a) Big Tech rapes artists
          b) Artists protest
          c) Indie labels protest
          d) DMN and Hypebot leak embarrassing documents
          e) Embarrassing documents and indie protests reach the music press
          f) Taylor Swift steps in
          g) New York Times brings the story
          h) Big Tech company apologizes for rape — didn’t mean it, will never do it again.

          What we need is a user-friendly site where we can systematize and organize a SWIFT and unified response to next week’s rape.

          Reply
          • Troglite

            +1

            Unfortunately, DMN doesn’t appear to be that site (at least not yet).

          • Sarah

            You know … if we just get rid of (a), then we don’t need the rest of the steps at all….

    • Truancy

      This whole operation reeks of PR STUNT. Artists are not relieved, Apple, we’re pissed you think our livelihood is a joke. You and Taylor Swift can flex all you want….I hope the next digital medium kicks your ass.

      Apple: “Well we ignored everyone else that was concerned and complained and actually needed to get paid, but when Taylor voiced her opinion, we flipped our entire introductory model…”

      mentirosa.

      Reply
      • Fuck Apple!

        “This whole operation reeks of PR STUNT”

        Because we really used to hate Apple, but now we definitely love them, eh?

        “Artists are not relieved, Apple, we’re pissed you think our livelihood is a joke. […] I hope the next digital medium kicks your ass.

        Apple: “Well we ignored everyone else that was concerned and complained and actually needed to get paid, but when Taylor voiced her opinion, we flipped our entire introductory model…””

        +1

        Reply
    • PsyhoMedia X

      With 192 billion of cash sitting in Apple’s vault they don’t need to be giving artist property away for free . They gave my shit away with a free Pepsi–Access to a free track under the top winner and didn’t even have my permission: Fuck what that stupid ass Jew told you stink cracker bastards ! Both Apple and Pepsi are liable for the theft of my property and I want both of those fat asses !

      Reply
  2. pbody

    how much? or how about saying ‘paid fairly’? – hopefully Taylor’s response

    Reply
  3. Anonymous

    Cue’s explanation is the lamest ever:

    “When I woke up this morning and saw what Taylor had written, it really solidified that we needed a change. And so that’s why we decide we will now pay artists during the trial period.”

    In other words:

    Without Taylor Swift, Apple would have screwed us all.

    Cue added that Ms. Swift was “very thankful and excited to see how QUICK we responded”.

    Quick!

    I’m not lying to you, that’s the word he used. After all this time…

    Reply
  4. Paul Resnikoff
    Paul Resnikoff

    Without Taylor Swift, Apple would have screwed us all.

    I don’t think so; it was already in motion. Swift just created extreme urgency in the matter. But over the weekend, speaking to several sources close this, I learned that Apple was planning on making the shift, and frankly was hoping for something quieter than this.

    Reply
    • Anonymous

      According to Cue, Swift was the deciding factor:

      “When I woke up this morning and saw what Taylor had written, it really solidified that we needed a change. And so that’s why we decide we will now pay artists during the trial period.”

      Reply
      • Paul Resnikoff
        Paul Resnikoff

        Yeah, of course. Swift made a big stink, it was an oil spill in terms of bad publicity. So Apple acted really fast to plug the leak.

        But this was already in motion, Apple was already planning to give up its gratis, no royalty free trial proposal. No indies were going to participate, and they have a launch date June 30th.

        Reply
        • Anonymous

          Well… whatever happened in Cupertino, you’re as responsible as anyone.

          So, thank you!

          Reply
        • Anonymous

          Paul, I wonder if there is a catch: Last week, Apple offered to pay a few % more than Spotify. But is that offer still good?

          Here’s what Cue said today:

          “We’ve been hearing a lot of concern from indie artists about not getting paid during the three-month trial period, which was never our intent. We never looked at it as not paying them. We had originally negotiated these deals based on paying them a higher royalty rate on an ongoing basis to compensate for this brief time. But when I woke up this morning and saw what Taylor had written”

          So are they just going to reduce that rate now?

          Reply
          • Sarah

            Nice catch. That is curious phrasing.

            If Apple’s smart, Apple will not change what they “originally negotiated” at all, simply pay out for the 3 months in addition to the (slightly) higher royalty.

          • Whawha

            “So are they just going to reduce that rate now?”
            According to Billboard who got an interview with E.Cue, no, they will maintain the rate. It was still a dumb move to start with, but at least they do repair their errors , unlike other companies.

  5. Anonymous

    Top 5 Enemies:

    1) Google
    2) Apple (post Jobs)
    3) Spotify
    4) ISPs
    5) Pirate Bay

    Reply
      • Edward Jennings

        I don’t consider Microsoft a player in the digital music business. They can do much better than X-Box Music. They don’t leverage their software clout in this category. Ironic when they are a Cloud first, Mobile first company and music is imperative on both.

        Reply
  6. There is something...

    I think all Apple haters should put their money where their mouth is and just remove all their music from iTunes. Why use a service from a company you hate ?

    Reply
    • Anonymous

      “I think all Apple haters should put their money where their mouth is and just remove all their music from iTunes”

      Good suggestion!

      Bandcamp’s cut is just 10-15% — compared to Apple’s 30%. Bandcamp also offers considerably more options and flexibility (pricing, email lists, links to social media, merchandising, etc.).

      And Bandcamp doesn’t force you to work for free! Compare to iTunes: Long previews and iTunes Radio are mandatory (Beats1 may be mandatory too, but that’s next week’s scandal).

      Reply
      • Anonymous

        “And Bandcamp doesn’t force you to work for free! Compare to iTunes: Long previews and iTunes Radio are mandatory”

        i love bandcamp, but you”re wrong. Full length previews of your tracks is mandatory on Bandcamp, unless you pay a $10 option per month.

        Reply
        • Anonymous

          “unless you pay a $10 option per month”

          Oh wow, that just ruins everything. :(

          Seriously, fellow Anonymous — you don’t even have to pay an aggregator, what’s $10 a month?

          Reply
          • Ray

            CD Baby has a free option that allows you to just put digital tracks on their site. You have the option of a 30 second preview or full streaming. They take 15% for downloads that sign up for the free service.

          • Anonymous

            “They take 15% for downloads”

            …which is just plain ridiculous.

  7. jeffserrano

    the merlin indies will still bitch. they are not getting advances and that is what the complaining is really about. mark my words.

    Reply
    • Anonymous

      Plus, if Apple pays artists during free trials now, the royalty rate will probably be reduced. Here’s what Cue said today:

      “We’ve been hearing a lot of concern from indie artists about not getting paid during the three-month trial period, which was never our intent. We never looked at it as not paying them. We had originally negotiated these deals based on paying them a higher royalty rate on an ongoing basis to compensate for this brief time. But when I woke up this morning and saw what Taylor had written”

      Aside from that, Apple Music is going to cannibalize iTunes like there’s no tomorrow…

      Reply
    • DAn

      Merlin has no contractual relationship with iTunes – never has never will.

      Reply
  8. Anonymous

    So can we expect 1989 on the June 30th launch? Didn’t think so.

    Reply
    • Anonymous

      So? It’s her album, she can do whatever she wants with it.

      Hate artists much?

      Reply
      • Anonymous

        Not at all. But I don’t like people who blame others to justify their own unpopular actions. She blamed Apple’s 3 month unpaid trial for the reason she is withholding 1989. That she was standing up for the little guy and for what was right. We all know that’s not true. She’s withholding it because that’s what she does. She wants the most money she can get. It has nothing to do with helping anyone else. Now Apple has caved and she has no excuse for not releasing 1989. But it is highly unlikely we will see 1989 on June 30th.

        Reply
          • Anonymous

            You really need better insults if you think calling someone a stooge for one of the most innovative and highly regarded companies of all time is an insult.

  9. DavidB

    I don’t buy the idea that it was all a conspiracy from the outset, but I wouldn’t rule out the possibility that Apple had prior knowledge of Taylor Swift’s blog, and were happy to take the opportunity to dig themselves out of a hole with an appearance of good grace.

    Reply
  10. Yep

    The math…

    Spotify premium does about 30 billion paid streams a quarter right now. Apple Music is FREE, so lets say 10 x as many streams from the service in Q3. EVEN Apple will find that a tough bill to pay. Even if they go as low as $0.005 per stream, that’s 840 million dollars, for 3 months, for labels. From 0 income, and most likely a massive PR bill.

    And if the rate is lower than that, Label will withdraw content for sure.

    Reply
    • There is something...

      And what will be Spotify per stream payout during their 0.99 premium offer ?

      Reply
    • Anonymous

      Your “math” is inane.

      You’re assuming Apple will have the exact same amount of users as Spotify the first 3 months. It won’t.

      Reply
  11. Anonymous

    Tweet of the day:

    “I just played a gig inside a giant owl and my girl just changed the entire music industry what a day”

    SOURCE: Calvin Harris, Twitter

    Reply
    • There is something...

      Changing the entire music industry ? Ah ah, sorry but no…

      If you really think about it, nothing is changing… But it makes people talk. It’s a very good PR for TS, and not a so bad one for Apple Music (and nobody is speaking about Tidal anymore). The “industry” itself will be about the same than it was because people are moving to streaming whatever TS is saying or not.

      Reply
  12. Musicservices4less

    This is a somewhat good sign not only for Apple but for the industry as a whole. At least one company in tech music distribution is listening. Maybe that is because Apple isn’t trying to go public or rely on venture capital. Who knows. And as they say, the devil is in the details. Such as:
    1. How are they going to compute royalties for the 3 months
    2. At what rate
    3. Are indies getting the same rate computation and royalty as the majors
    And for Shi*ts and Giggles, were the Majors taking a hit on the 3 months or getting paid? If so, what rate and computation?

    And don’t forget where this all started: Right here on DMN!
    TRUTH TO POWER
    !

    Reply
  13. pahahahahaha

    ‘It started with a leaked contract on DMN….’

    really? REALLY?? you are trying to claim some credit in this shambles????

    Reply
    • Anonymous

      “you are trying to claim some credit in this shambles?”

      Why wouldn’t he? A lot of articles link to DMN stories.

      Reply
  14. hank@nv.net

    I dreamed I saw a joust between Anonymi. Nobody could tell who won.

    Reply
  15. channeledbymodem

    I’m sure I’m missing something since this was not brought up, but surely Apple is paying labels, not artists and labels are still screwing artists, are they not? So how does Apple agreeing to pay labels even more money help artists? Sincere question; I’m not in the business.

    Reply
    • Anonymous

      Labels pay in turn the artists they signed, according to whatever percentage is in their contract. Also some artists are self- distributed on iTunes, so Apple pays them directly. It’s the same in all stores.

      Reply
  16. MarkH

    So 3 months of streaming payouts is a big deal now? I thought streaming revenue was crap.

    Reply
    • GGG

      Well sure, the actual payouts might still be an issue, but at least the principle of the most valuable company in the world not paying out anything is fixed. One step at a time.

      Reply
  17. superduper

    Sure, they’re paying something, but will it be enough to replace iTunes sales, keeping in mind that the payouts are only marginally higher than 0?

    Reply
  18. Just Say No To Streaming

    The 3 months doesn’t matter. How many downloads (and yes they are downloads when they are offline cached) do you have to sell to make 1 US $ ?

    The majors, Crapify, Apple just ended any chance of making money from recorded music.

    And they did it because they can skim off the top of ever single thing ever recorded and have zero outlay.

    Reply
    • Lyle David Pierce III

      In general, rather than describing songs that are cached offline as “downloads,” I think those songs are more properly defined as copies (duplicate copies to be more precise), hence, the necessity of streaming services such as Apple Music and Beats 1 radio obtaining the prior informed consent and authorization of those rights holders before duplicating and performing the same – savvy?

      http://www.soundexchange.com/wp-content/uploads/2014/11/2014-11-14-Order-on-Summary-Judgment-Flo-and-Eddie-v-Sirius-XM-SDNY.pdf

      Reply
      • Lyle David Pierce III

        On the other hand, Harper & Row v. Nation Enterprises makes clear that, among other things, “The [pre-existing common law] right of first publication encompasses NOT ONLY THE CHOICE WHETHER TO PUBLISH AT ALL, but also the choices of when, where, and in what form first to publish a work.” [Emphasis mine.]

        The fact that a work is unpublished is a critical element of its “nature.” [Citations omitted.]

        Thus, the necessity of streaming services such as Apple Music and Beats 1 radio obtaining the prior informed consent and authorization of those rights holders before publishing the same – savvy?

        Reply
    • It gets worse

      …If the user is part of iCloud, the streams do not count as “Royalty Bearing”. Therefore you will get nothing since most Apple users are now using iCloud.

      Reply
      • Just Say No To Streaming

        Well, who cares anyway? I mean when they ‘pay’ it’s a fraction of a penny anyway.

        I have 32 albums on itunes, and they are not going to Apple Music.

        Reply

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