The music industry has undergone a lot of changes in the past few years. The rise of streaming services like Spotify and Apple Music has completely changed the way people consume music. However, there was a time when the iTunes Store was one of the most popular ways to buy and download music.
In 2011, rumors started to circulate that Apple was considering shutting down the iTunes Store. This was due to a potential increase in mechanical publishing rates, which would have made it more expensive for Apple to sell music. The Copyright Royalty Board was considering raising the rate to 15 cents per download, up from the previous rate of 9.1 cents.
The news was met with concern from music stores and industry insiders. Many believed that if Apple were to shut down the iTunes Store, it would have a significant impact on the music industry as a whole. The iTunes Store had been a major player in the music industry since its launch in 2003, and its closure could have potentially caused the collapse of other music stores.
However, at the eleventh hour, Apple executive Eddy Cue testified before the Copyright Royalty Board, suggesting that Apple would exit the paid download space if mechanical publishing rates were increased disproportionately. This testimony led to the Copyright Royalty Board agreeing to maintain per-download publishing rates at 9.1 cents, a move that was applauded by music stores.
Jonathan Potter, the executive director of the Digital Media Association (DiMA), was one of the industry insiders who welcomed the decision. “Keeping rates where they are will help digital services and retailers continue to innovate and grow for the next several years, which will benefit songwriters, artists, labels, and publishers,” he said.
Roger Faxon, the chairman and chief executive of EMI Music Publishing, also expressed his satisfaction with the refreshed rate structure. “With today’s decision, and the agreement on interactive streaming and limited downloads announced last week, we now have a rates structure that will provide a solid platform from which the music marketplace can grow,” he said. “That has to be a good thing for fans, songwriters, and all those involved in the music business.”
Even the National Music Publishers Association (NMPA), who had been pushing for a higher rate, expressed satisfaction with the decision. “The most important thing we wanted to keep was a penny rate,” said NMPA president and chief executive David Israelite. “We were petrified of locking in a percent model, because we don’t know where prices are going.”
The decision to maintain the per-download publishing rate at 9.1 cents was a significant win for the music industry, especially for those who were concerned about the potential closure of the iTunes Store. The decision allowed for digital services and retailers to continue to innovate and grow, which ultimately benefits everyone involved in the music industry.
Looking back, it’s clear that the music industry has undergone a lot of changes in the past few years. The rise of streaming services has completely changed the way people consume music, and it’s unlikely that we’ll ever see a return to the days of the iTunes Store. However, the decision to maintain the per-download publishing rate at 9.1 cents was an important moment in the history of the music industry, and it’s something that should be remembered for years to come.