Apple threatens to remove music if bands don’t agree to new royalty policy

http://consequenceofsound.net/2015/06/report-apple-threatens-to-remove-bands-music-from-itunes-if-they-dont-agree-to-new-royalty-policy/

by JohnTHaller • 11 years ago

40 51 11 years ago

consequenceofsound.net

feld• 11 years ago

If everyone says no they'll have nothing in the iTunes store

Seems simple enough.

a2tech• 11 years ago

They already have a 'yes' from the big labels. The big labels probably look at 3 months of no revenue from Apple streaming as a storm they can weather on the way to bigger profits from Apple Music in the long term. Smaller labels are more likely to be sensitive to temporary lapses in income.

jlgaddis• 11 years ago

What is their current income from Apple streaming?

Since it hasn't even launched yet, wouldn't it be $0? Thus, there are no temporary lapses in income.

vijayr3• 11 years ago

If consumers buy directly from artists they love (wherever possible), that can help too. Didn't Louis C.K, Aziz Ansari etc sell their work themselves? May be this will work in music too?

meesterdude2• 11 years ago

Seems like every new apple venture has a hidden "fuck you" wrapped in it somewhere, for someone.

happyscrappy7• 11 years ago

If all you have is an Apple hate hammer then everything looks like a nail.

meesterdude2• 11 years ago

I don't hate apple, just what they do.

forthefuture2• 11 years ago

Or maybe Apple just does a lot of things that are negative for everyone but Apple, and all of the profit they steal from other people they keep in cash and don't even reinvest, leading to the largest misappropriation of resources in human history.

swsieber• 11 years ago

And if you have no hammer? Do you see no nails? Just because someone has a hammer doesn't mean there aren't a lot of nails. Arguing that someone must be wrong because they have an emotion is wrong - the amount of nails is independent of who has what tools, hammers included.

Disclaimer: I use a mac.

gress7• 11 years ago

Headline is false. Apple will remove bands from iTunes if they don't offer a free trial.

As for this being a 'threat'. It's clearly not - it's a mutual disagreement. The statement could just as easily be 'some bands abandon iTunes because they don't want to give free trials'

ta92929• 11 years ago

So, Apple wants to promote its new streaming service using musicians' music for free, and threatens to to remove them from a different platform, iTunes, if they don't comply. Still pretty bullshit.

kedean• 11 years ago

Yeah, seems like pretty basic blackmail to me.

gress7• 11 years ago

False. iTunes is not a different platform. Companies are not forced to keep their services the same forever.

dreamfactory22• 11 years ago

The story is that they are leveraging their position as a platform to enforce new terms. This is the kind of sharp practise people complained about with 'the big 5' record labels using their collective monopoly over distribution and can be seen as a form of bait and switch.

gress7• 11 years ago

Except that there is vigorous competition in this market. Amazon and Google, Spotify, RDIO are all hailed as innovating on how we buy music. Apple is simply updating its service to respond to consumer demand.

PublicEnemy111• 11 years ago

Isn't Google doing the same thing with the new YouTube deals?

JohnTHaller2• 11 years ago

One difference is, even if they did, the bands can have their music available on other services within Android that can download music right into their music library on their phone/tablet. Apple purposely disallows 3rd party apps from adding music to the iOS music library.

6stringmerc• 11 years ago

Well, this is a new development. I will state that my personal experience is different than what is claimed here. With the distribution service I pay for / use, Apple Music was an "opt-in" service. My music can be on iTunes or Apple Music, or both. Different releases can be categorized as I see fit, at least for now.

So, I'm not sure the claim of "will remove bands" is entirely accurate. They might remove Brian Jonestown Massacre, but I'd like to have a good look at the contract they have with their record label, and the label has with Apple, before I expand such a claim. Maybe Newcombe doesn't know that it's a bargaining position between his label (or affiliated labels) and Apple...because while he's obviously really, really mad, I'm unsure if I believe his situation is entirely representative of the entire sphere of musicians out to make some money in this arena. In other words, maybe he signed a bad contract and should go yell at the mirror for a little while just to be fair.

While I'm on this soapbox, I'd also like to point out that unless Newcombe has a contractual obligation to his label to have music on iTunes, then pack up and leave. Go join TIDAL on principle. Or, even more to his point about wanting to get paid, go exclusively with Bandcamp and set the sales price to $50 per track. Take a stand, show the world - actions speak louder than words is an old but good expression for cases like this.

Again, unless the contract he/they signed handcuffs their decision making, there are a lot of options other than ranting at a behemoth retailer with a significant market share. Do I work for Apple or even use iTunes personally? Nope. Do I like getting pennies from Spotify versus some pretty decent revenue from iTunes or Amazon? Not particularly. I've marched down my own path as an independent who doesn't make a living in music, mostly because I've never wanted to try making a living in music. It's a ridiculously hard industry, and I dislike living in poverty quite a bit.

It will be interesting to see what the 'investigations' turn up regarding Apple's negotiating tactics and behavior during this process. Many people understand they're sitting on a giant pile of off-shore, un-taxed cash...and believe the company could pay artists / labels / meat popsicles like me for every listener's 3 months worth of royalties without a catastrophic impact to its business. But, like with those billions of dollars, I'm also aware that Apple's mentality seems to be "We don't want to pay, and if we don't have to pay, we won't pay." I don't like it, but I'm not remotely surprised by it.

w42• 11 years ago

As I mentioned in the other thread re: Beggar's Group, the 3 months free streaming is likely to represent a significant financial hardship to indie labels. Since everyone with an iTunes account gets free Apple Music for 3 months, you can expect that sales on iTunes will plummet during that period.

While the major labels can weather the resulting loss of revenue, losing a significant number of your sales from the world's largest music store for a full quarter is likely to put some indie labels and artists in a position where they're unable to pay their bills. Apple Music's impact will likely ripple out to sales at other stores, too, which will worsen its impact on revenues. And while artists can at least fall back on touring revenue, small labels don't have that option.

I can see why labels and artists are upset. Apple Music's free trial may very well have a ruinous effect on their livelihoods.

dreamfactory22• 11 years ago

This is exactly why the arrival of mp3s was in reality hugely damaging to the independent music business and favoured the majors.

ghshephard3• 11 years ago

How is this any different than Youtube? I was at a party last weekend, and the host had their PS3 setup to stream a youtube stream from anyone who connected via their WiFi. Basically anyone at the party connected to their Wireless Lan was instantly authenticated to add music (it was pretty slick). Everything I tried (including all the artists like Taylor Swift who had dropped spotify) had pretty much all their music there. everything seems to be there. When I asked how much this cost, given that it was also showing videos, the answer I got was, "It's all free, man!"

Everyone talks about rdio, spotify, upcoming apple music, etc... But Youtube already seems to have unlimited free streaming of music + videos, with what appears to be universal selection.

plorkyeran• 11 years ago

Youtube pays royalties from their advertising revenue these days, and Google is shocking good at making money from advertising.

quesera2• 11 years ago

Absolutely true. Most indies operate on such a shoestring that a single quarter is a big deal.

Total streaming revenue might realistically drop by 30-50%, assuming a large fraction of Spotify etc users cancel while Apple Music is free.

Catalog sales will take a hit too, a large hit for iTunes sales. Probably less for other channels.

And artists with new records coming out now will likely take the biggest hit. On the other hand, no one releases records in the summer.

October begins the new indie release year, so maybe the timing is almost as good as it could be.

PopsiclePete• 11 years ago

I'm sorry, but if you can't survive, as a band, for 3 months by playing live gigs or temporarily getting a different job, then maybe....it was never meant to be?

Don't get me wrong, I don't want to listen to Taylor Swift and Jason Derulo all day long either, but if some indie band is so obscure and hip that it can't pay the bills for 3 months....I dunno....maybe they were never that good?

No band deserves some kind of regular income. Nobody does, in our society.

If I listen to your stuff for 3 months, for free, and like it, why would I stop after my trial expires? Heck, with a free trial, I'm more likely to discover your hip obscure super-cool indie band and more likely to support them later.

DanBC• 11 years ago

Most bands lose money on live gigs. At least this is true in the UK.

w42• 11 years ago

I'm sorry, but if you can't survive, as a band, for 3 months by playing live gigs or temporarily getting a different job, then maybe....it was never meant to be?

I specifically mentioned that as an option - hence why this is a much larger concern for labels than artists (though I'm sure it's a concern for artists as well). Also keep in mind that a live tour takes months to pull together. Apple hasn't given artists that sort of lead time.

And all of that having been said: in what other industry is it normal to say, "Well, if you can't handle a full quarter of decimated revenues dropped on your head with weeks notice it was never meant to be"? Many SMBs couldn't weather that storm. That doesn't mean they're fundamentally broken.

bakhy2• 11 years ago

if ownership is measured by the ability to do what you want with something, than Apple almost owns music.

does this constitute a basis for suing Apple under anti-monopoly laws?

gress7• 11 years ago

Ownership isn't measured by the ability to do what you want with something. It's the exclusive right to do what you want with something.

Apple's music licenses do not prevent artists or labels from selling their music elsewhere.

What Apple does own is its own platform.

bakhy2• 11 years ago

Compare this with Microsoft and the bundling of Internet Explorer with Windows. Certainly, the MS case sounds like a joke when compared against this. And MS lost...

To me, this Apple story is clearly an abuse of dominant market position.

Aloha• 11 years ago

As far as I'm concerned - the man who owns the press controls the price books are sold for - this analogy is directly applicable here.

quesera2• 11 years ago

It's simple. Apple wants to launch with a credible claim of "all iTunes music" in their service. So they really really want you to agree, and probably make block deals with labels (who generally control streaming rights).

A band like Brian Jonestown Massacre might control all or most of their streaming rights. The band is only important to Apple if they are helping Apple's marketing for Apple Music.

It's heavy handed, but it's typical Apple: unless you are a huge partner, you have to sign up for the whole enchilada, no piecemealy crap. Hanging back a few months to ride the future success of Apple Music's marketing plan without being a part of the marketing effort? That doesn't really seem fair either.

Apple has no time for hesitant minor partners. You're either in, or you're out.

Unfortunate comparisons to George Bush and Heidi Klum are unfortunate.

JohnTHaller2• 11 years ago

One other big point that iOS users don't have the same freedom of choosing other merchants to purchase music on their devices. Purchases made and downloads made in iOS from 3rd party services are not added to your music library to play, unlike Android where any app can add music to your library and any app can play it. So, any band/label deciding to remove their music from iTunes because they'd rather not forgo a full quarter of revenue will lose out on a good percentage of iOS users.

Apple threatens to remove music if bands don’t agree to new royalty policy

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