Apple Still Paying NOTHING on Comp’d Accounts…

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After indie labels flatly refused to play along, Apple finally agreed to pay a paltry $0.002 on every stream during its free trial period.  But Apple, one of the richest companies in the world, is still paying nothing on free comp’d accounts, which includes freebie accounts used by Apple executives, partners, prospective advertisers, friends of Apple execs, and members of the media (and no, DMN isn’t on that list).

We know this because it’s clearly stated in the latest, updated Apple contract, leaked to DMN.  It’s right below the part where they say they’ll be paying

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So when Apple CEO Tim Cook grabs a sandwich at Apple headquarters without reaching for his wallet, Apple still pays for the ham and cheese.  But when Tim Cook — and every other Apple executive, associate, friend, and relative — streams a hours of music on Apple Music, Apple pays nothing.

Apple Music launches tomorrow, June 30th.

29 Responses

  1. Anonymous

    Apple also pays NOTHING on any streams of audio or video posted to the Connect social network.

  2. Noah

    Well, I guess that Apple has been going through some financial issues. So it might be hard for their executives to have to pay for what they consume. They do deserve something for nothing after all…

    That was sarcasm btw

  3. hardwich

    Must be a slow news day for Digital Music News.

  4. Marcus

    Paul, come on man. I’ve got no special love for Apple but please show us another streaming contract that handles comps differently. This is boilerplate.

    Stop beating this dead horse, please.

    • FarePlay

      Apple has made a lot of money over the years selling hardware that supports music and selling music. Not to mention that purchasing music has kept many of their customers tied to the Apple Brand.

      My hope was that Apple Music could be different. They certainly could have afforded to take the high road. So to say ‘don’t beat on Apple because everyone else does it’ is no justification in my mind. Jobs was always against ‘renting’ music. Ultimately, I believe Apple felt they had no choice, but to hedge their bet and get into this lousy business.

      Jobs may have reinvented the music business, but that we will never know. I’m still trying to find out if he was involved in the decision to remove optical drives from their computers, which happened after died. I do know he listened to vinyl.

      Talk about watching a train wreck in slow motion………..

      • GGG

        Gotta agree with Fareplay here.

        I know “business is business” and all that bullshit, but for fuck’s sake, when your company is worth hundreds of billions of dollars, you can throw people a bone every now and then. They could literally pay out a hundred billion dollars and still be THE most valuable company in the world…by a few hundred billion.

        And putting that ridiculous example to real life, Spotify claimed to pay out $1B last year in royalties. So Apple could double Spotify’s royalty rate, have millions more users, and that $100B would still carry them for decades. Now, obviously I’m using stupid examples, but you get my point. Spotify pays shitty because their current business model pays shitty. Apple pays shitty because they choose to.

  5. Sonny Brooks

    this is from the contract that was posted on the 17th right? There wasn’t a new one that wasn’t posted?

  6. Versus

    This is pathetic.
    Especially since the number of comps is essentially unlimited, unlike the days of physical promotional CDs.

    • Paul Resnikoff

      Not following the logic. If it’s such a small, limited amount, why not pay?

      Does Tim Cook just take a ham sandwich from the deli down the street, because a lot of Apple people eat there? After all, he’s the CEO, and he’ll only eat a limited amount of sandwiches.

      • iggypopbarker

        Paul – it’s fairly standard practice for streaming companies to exclude complimentary accounts from royalty payments. I used to work for a streaming service and we did it. I had comp’d accounts from other major streaming services and was told (by some) all streams were royalty free as well.

        • Paul Resnikoff

          I’m not following that logic, either. A lot of things are ‘standard practice’ but are completely wrong. I’ll take an extreme: slavery. Once upon a time in, say, South Carolina, if someone stood up and said something against slavery, they’d be given some stern speech about ‘standard practice’ and tradition. Or, they’d be killed.

          • iggypopbarker

            Wasn’t condoning the practice – just pointing out that most streaming companies are doing it, so why the fake outrage when Apple do it?

  7. Silly Con Valley

    Apple cannot and will not ever get it right because they come from the wrong place. Their history of enslaving musicians and other creators accidentally on purpose will never be lived down. Apple Music will flop along with Spotify and every other subscription-streaming model because they are inherently flawed. A new and better model will emerge and put them all to shame and the creators of the art that Apple has depended on to drive their device sales for the past decade will take back the power once and for all. “Free” was not an accident, it was engineered and calculated from the beginning by the same people who are now refusing to pay artists once again. Old habits die hard.

    • Anonymous

      “A new and better model will emerge and put them all to shame”
      Yeah… We’be just been waiting for this utopic model for how long… the last 20 years ?
      I’ m sure someone will finally come up with a new and better model in 324 years for now.

  8. Name2

    Just had to buy an album from itunes because it was an exclusive.

    $10, 256kbps files, “Mastered for iTunes”, and my life story in three security questions.

    Really? This is the apex of music buying that the idiots on DMN tout as the be-all and end-all of exquisite consumer experience?

  9. Silly Con Valley

    Apple Music is launching tomorrow…thank god we’re all gonna be saved. Oh what a glorious day, the wait is finally over…at last, a truly sustainable (and proven) business model that respects the rights of artists while simultaneously providing consumers with a far superior alternative to CDs in the way of quality, functionality and interaction. Oh and not to mention the in-depth credits that they provide, allowing the artists and creators to be recognized for their work. Thank you Apple Music, thank you. Now all we have to do is sit back and watch the money come rollin’ in.

  10. jazzdog

    Is this really so different to a record company sending out hundreds of promo CDs?

  11. Olie

    Seeing as DMN feels dissed about not being comp’d, perhaps it should try to become accredited as a music publication whereby it actually reviews and positively promotes the actual music the artists create and perform. That way it may not have as many slow NEWS days.

      • oil e

        no music being made here, for you not to review. maybe dmn could start using a straight pen to match wit with the mind, cuz da fingaz are getting way too big for the keys, and pretty soon they’ll be as bigz as your heads. nah, better still, take group pee-ano lessons….learn about the music (as good ‘ol DL would have said). btw way there’s a new double-oh-7 flick en route soon, for dmn and pundits to hone those covert ops/ cryptic skills, for your next assignment. oh that reminds us, if anybody’s interested we’ve copies of some old 19th century scott joplin recording and sheet music contracts, that may just get y’all worked up for the next case___ now that the apple has fallen from the tree.

        3 cheeers

  12. Ed Harris

    So the complaint here is that Apple isn’t paying streaming royalties to record labels for comp accounts that aren’t generating revenue? The same labels that don’t pay royalties to artists or publishers on comp product that they give out? Why should labels be treated differently than they treat others?

  13. Wooly

    Paying out nothing is better than charging for the privilege. Isn’t that the way record labels used to treat dot coms – tons of up-front money?