The iTunes Store is still in business after all, despite a late-stage scare suggesting otherwise.
At the eleventh hour, testimony from top Apple executive Eddy Cue suggested that Apple would exit the paid download space if mechanical publishing rates were increased disproportionately.
Instead, the Copyright Royalty Board agreed to maintain per-download publishing rates at 9.1 cents, a move applauded by music stores. “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,” said Jonathan Potter, executive director of the Digital Media Association (DiMA).
Others also seemed positive on 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,” said Roger Faxon, chairman and chief executive of EMI Music Publishing. “That has to be a good thing for fans, songwriters and all those involved in the music business.”
Surprisingly, the National Music Publishers Association (NMPA) also expressed satisfaction with the rate, despite rallying for something much greater. “The most important thing we wanted to keep was a penny rate,” NMPA president and chief executive David Israelite told Digital Music News. During the negotiation process, DiMA had been pushing for a much lower, percentage-based formula. “We were petrified of locking in a percent model, because we don’t know where prices are going,” Israelite continued while characterizing a 24-cent ringtone mechanical as “out of this world”.