Apple Says “We Hear You Taylor Swift”, Will Pay Musicians During Free Trial

http://techcrunch.com/2015/06/21/apple-music-free-trial/#.d9n1qq:0AVt

by 666_howitzer • 11 years ago

136 147 11 years ago

techcrunch.com

tostitos1979• 11 years ago

Fantastic! What's next? How about paying software engineers during full day interviews?

kevcampb• 11 years ago

Maybe they can look at fixing my #staingate screen.

amelius• 11 years ago

How about just disclosing app and music sales statistics, so everybody can make an informed decision about whether to produce for the platform or not.

JonnieCache• 11 years ago

Some people do actually do that.

kincardine7• 11 years ago

I was paid during the final round of interviews for the job I currently have.

mseebach• 11 years ago

Yes, let's make sure the bar to get someone onsite is even higher, so employers have to rely even more on the signal they collected before ever having met the candidate in person.

nemo• 11 years ago

More like a 90 day interview.

hyperbovine• 11 years ago

How about asking? All I ever hear about is how it's never been more of a seller's market for software engineering talent.

noobermin• 11 years ago

Well, even given the variety of opinions in the discussion yesterday, I think most people will be happy here. Apple did the right thing, at the very least, for good PR purposes.

themartorana• 11 years ago

Right on. If we blame them for poor decisions, it's rather mean to then blow off the righting of that wrong. Kudos where they are due. Maybe it is for PR purposes, but at least the outcome is positive.

Thanks, Apple.

BenjiSujang4• 11 years ago

Agreed, but I wouldn't go as far as to thank Apple. And of course it's for PR purposes. All large companies are sneaky.

oddevan• 11 years ago

I totally get the major labels making the 1.5% increase/3-month trial concession; but after nearly every independent artist I pay attention to basically said they couldn't/wouldn't make the same concession, I'm glad Apple relented. I want one of these services to at least act like they appreciate the value of music.

Myself, I've never made enough off that one rap CD to recoup the cost of sending it to CD Baby, so I've got NO skin in this fight. :)

FireBeyond2• 11 years ago

Eh, 1.5% extra for a 3 month trial with no royalties was utterly contemptual and only appealing to those who couldn't do math: 100/1.5 = 66.67 x 3 months = 200 months to recoup the lost royalties.

For a music streaming service, looking to recoup your lost royalties after almost 17 YEARS (and only getting 1.5% extra at that) is laughable.

Joky2• 11 years ago

It looks to me like this reasoning is laughable. It looks like the same reasoning as when the major are counting every single pirated song as a "missing sale". Like if it would have translated in a sale otherwise...

The three months free period is intended to make the amount of paid customer bigger after the three months, so you have to account for that (and you don't). I don't know what is the predicted impact of the three months on the subscription numbers, but let's imagine you would have a two times faster market penetration. After a year you would have 3 months free and then 9 months with double amount royalties, compared to 12 months single royalties.

kincardine7• 11 years ago

So, without making a judgement call on this actual decision.

It amazes me that no one saw this type of reaction from artists (and the generally pro-artist consumer base) coming when the overall business plan was created. And that the concession was made so quickly...

jimmy0x52• 11 years ago

Gee it's almost like it was a PR stunt.

kincardine7• 11 years ago

That's what I meant to imply.

twoodfin• 11 years ago

...and now there's tons of free media that Swift's latest album will be on Apple Music (and not on Spotify)!

I think this is a bit too much of a bank shot to have been planned ahead of time, but nice work by Eddy Cue and Apple PR to acquire and then cash in this bargaining chip in probably the most effective way possible.

matthewmcg• 11 years ago

"Bank shot" +"Eddie Cue" = nice billiards pun!

smackfu7• 11 years ago

Apple got the labels to agree to the deal already, why would they care about the artists?

k-mcgrady• 11 years ago

They only got the major labels - not the indies.

zxcvcxz3• 11 years ago

What Apple should do is pay only the bottom 90% of artists and when someone downloads free music from one of the top grossing 10% of artists, the would-be revenue should be re-distributed to the bottom 90% during the users free trial.

Taylor said herself that it wasn't about her, but about small artists trying to break through. I'd like to see her put her money where her mouth is, but hey, if it's all about money that's okay too, but she should own up to it instead of pretending like shes looking out for smaller artists.

philjackson• 11 years ago

She implied it wasn't just about her. She deserves to be paid for her work too, and has done the other artists a big favour.

edit: Why is so much focus on the celeb. anyway? Shouldn't we be focused on the fact Apple was willing to completely screw artists for 3 months?

zxcvcxz3• 11 years ago

I wouldn't be surprised if 90% of downloads are only from the top 10% of artists. I believe swift was sincere when she said that this isn't about multi-millionaires, but about unknown artists trying to make a living.

By redistributing her income (only for the users first three months of course) she and other artists could really help the ones who are struggling, but hey, if it's all about money that's okay too, but she should own up to it instead of pretending like shes looking out for smaller artists.

mfoy_5• 11 years ago

Or they could just promote the up-and-comers more aggressively. Instead of a redistribution of wealth (which would be talent agnostic) go for a redistribution of coverage.

Also, if revenue was diverted completely from top artists to everyone else, what reason would there be for any of those top artists to be there? (Other than as a loss-leader for live shows and a "giving back to the community" sort of charitable thing)

Either way I doubt Apple Music would take off if they told the top artists that they were going to full Robin Hood on them.

zxcvcxz3• 11 years ago

what reason would there be for any of those top artists to be there?

That's why they should do it. To get rid of the facade that this is about helping smaller artists and show people what artists really care about art and which ones care about money.

I'm personally offended by Swifts letter. I don't think she really cares about smaller artists, she was just using them to manipulate Apple.

We all know that Taylor will now get millions of free downloads and be compensated, meanwhile struggling artists will probably get pennies. Shes not helping anyone but her self.

SchizoDuckie• 11 years ago

Musicians can complain when they want a bigger cut and it's fixed the next day.

App developers and content producers get emailed 'we are taking more out of your cut' or 'if you don't want us to show ads near your content, reply to this email with "opt out"'

kincardine7• 11 years ago

It's not that musicians can complain when they want a bigger cut and get it fixed the next day, it's that unicorn musicians can - like Taylor Swift.

josefresco• 11 years ago

Apple Gets:

Credit for throwing artists a bone. / Extended publicity for their new music service. / Credit for pleasing TS who has a lot of fans who would also be good customers for Apple

TS Gets:

Publicity / Sales for her new album / Credit for sticking up for artists

Seems like a win-win for both parties. I doubt the revenue lost would have been significant. Anyone have numbers?

sliverstorm• 11 years ago

Yup, that's the key. She is literally a rock star. (well, pop/country)

App developers don't have a millionth of the star power.

heydenberk• 11 years ago

A lot more people love Taylor Swift than love you, me or anyone at Rovio. In terms of PR, it's a straightforward decision.

skwirl• 11 years ago

App developers are building apps on top of Apple's mobile operating system. They cannot exist without Apple. Apple has nothing to do with the music being created.

terhechte• 11 years ago

Apple is not currently about to release a new App Store with new rules and has to hope that all the current App Developers will move over. Apple Music will suck if too many big artists refrain from signing up for it, so Apple needs to cater to the Artists.

It is the same with Microsoft's App Store, where they literally pay developers money (or used to) so they port their apps over to the store.

gilgoomesh• 11 years ago

I understand your point but your second line is completely inaccurate (at least, in regards to app developers). Apple have never changed the cut that app developers get nor have they ever shown unsolicited ads near/alongside/with apps.

stonesam92• 11 years ago

The part about increasing the revenue cut is unfounded, but I assume the seconds part of that line is in regard to Apple News[1].

[1] https://www.mikeash.com/pyblog/i-do-not-agree-to-your-terms....

mcv2• 11 years ago

Are you saying we should have app developers and content producers with a Taylor Swift-like popular status?

juliangregorian• 11 years ago

Are you saying we shouldn't?

weland• 11 years ago

App developers who are as big in application consumption as Taylor Swift is in music would get the same treatment.

cholantesh• 11 years ago

Sadly, I can't think of any developer that ubiquitous other than John Carmack...and he isn't even close to being active in this context.

davideous• 11 years ago

The big difference is that Apple has a monopoly on distributing iOS apps. In music, Apple has to complete with other music streaming services and other channels, so they have to be competitive to get artists to sign up for Apple Music.

Someone1234• 11 years ago

Apple has actual competition for music sales (or music streaming). Namely Google Play Music, Pandora, Spotify, Amazon/Prime Music, Xbox Music, and even ye' olde CDs.

With apps, because of the ecosystem isolations, Apple has no competition for access to THEIR user base (which is significant). So even if Google, Amazon, Microsoft, etc have their own apps stores of significant size, they aren't competing for Apple's users and thus cannot offer better terms than Apple.

kincardine7• 11 years ago

Not to mention, they're also much more heavily involved in the actual content creation for applications (Xcode, Swift/Objective-C, OS X, etc).

exelius3• 11 years ago

I'm guessing Apple just ran the math and decided "A $300 billion company should not damage its brand in a PR fight with a pop singer over a rounding error." Seriously, the amount of money we're talking here is probably less than $10 million a year. Apple gets to look like the good guy, the difference is immaterial to most artists, and Taylor Swift gets to feel important.

What upsets me about the whole thing is that Taylor Swift is absolutely not representative of most musicians. Unlike most young artists, she actually owns the recording rights to her albums. Typically you have to complete a 3-album deal where the studio owns the recording rights before you can negotiate terms (and even then only if you're a major musician by that point); but when your father buys a studio and signs you to a deal you get to keep your recording rights.

Taylor Swift's situation is much more representative of an owner of a recording company than an artist. While she's worried about points on the distribution deal, most artists feel that they'll never make any real money off the albums as long as the studios own the rights and just want you to hear their music and start to engage with them in other ways (social media, live shows, YouTube, etc) that they CAN monetize. By paying artists so little for their recordings for so long, recording companies have caused artists to place very little value on the recordings themselves and look to monetize their careers in other ways.

Alupis3• 11 years ago

Seriously, the amount of money we're talking here is probably less than $10 million a year.

Probably true, however remember Swift recently had the bout with Spotify, leading to the Spotify CEO revealing she was pulling in nearly $6 million a year from them.

001sky3• 11 years ago

"Typically you have to complete a 3-album deal where the studio owns the recording rights"

Taylor swift has made tons of product and has rights apparently because she does more work on her music than most artists.

https://en.wikipedia.org/wiki/Taylor_Swift#2004.E2.80.9308:_...

wmeredith• 11 years ago

There aren't any app developers with the popular support/cult of personality that Taylor Swift has. Tons of artists had come out against this already. Shit got real when she published that letter.

brentm• 11 years ago

It's not quite the same as Apple deciding that all apps in the app store, regardless of what you'd like to sell them for, are free during a 3 month introductory period.

tptacek2• 11 years ago

Don't app developers get a much bigger cut of revenues than musicians do? That being the case, I don't understand your comment.

Bud• 11 years ago

I'm not sure of all the details, but the standard cut on the App Store is 70/30 and has been for years. So 70% to the developer.

The cut on Apple Music for musicians is reportedly going to be 71.5% of streaming revenue. Pretty similar.

Tloewald3• 11 years ago

As we all know, musicians are wealthy fatcats and developers are poor starving artists.

When has Apple contacted developers to increase the size of its cut? Amazon claims to match Apple's 70% but in fact charges book authors for download size and halves your 30% for books over $10 (which is ridiculous given expensive books should have higher margins).

When has Google informed you that you can opt out of having ads shown next to your content in search results?

notNow2• 11 years ago

Well there's a pecking order within musicians. Taylor Swift apparently is not treated like any other artist (America's sweetheart) out there and she must be appeased, and handled with extreme care and affection, and all her requests granted.

So, your analogy or comparison here unfortunately doesn't hold water.

Yuioup2• 11 years ago

I don't understand why everybody is reporting this as "Taylor Swift". Shouldn't it be "Taylor Swift's Management" or "Taylor Swift's Lawyers". She obviously didn't plan this.

Keyframe• 11 years ago

Maybe she did, maybe she didn't. It doesn't matter. Naming is correct, since it's a brand. Same like POTUS - President did this, president said that... when in reality his staff did and said and he ok'd.

Yuioup2• 11 years ago

Yeah ok. I agree. Taylor Swift is indeed a brand.

adamlett• 11 years ago

Why is that obvious? It seems quite insulting to presume that people don't speak for themselves.

nailer• 11 years ago

She published it on her tumblr under her own name and seemingly in her own voice.

smackfu7• 11 years ago

The letter was written in the first person, on her Tumblr blog.

FreakyT• 11 years ago

Honestly, I'm pretty disappointed in this. The music industry has long been using bullying to get what they want, and this is no exception to that rule.

The sooner every traditional media company goes out of business, the better the situation will be for everyone -- listeners and artists.

BenjiSujang4• 11 years ago

And Apple, Google, Microsoft are much more philantrophic than the music companies ...

Of course not, they're worse as they gain more control. Best for customers and artists is good competition.

Marazan• 11 years ago

I know, imagine wanting to get paid for the work they produce. What utter scumbags.

I presume you work for free?

ceejayoz• 11 years ago

The music industry has long been using bullying to get what they want, and this is no exception to that rule.

I don't think Apple's negotiators are giving free puppies and flowers when they negotiate either.

laumars2• 11 years ago

Is Apple paying the artists, or the record labels? And if the latter, how much money would actually end up in the artists pockets?

Tloewald3• 11 years ago

Presumably it's paying the rights-holders, whoever they happen to be (i.e. usually labels). How would you expect it to work?

laumars2• 11 years ago

The way you described, but the articles keep referring to the artists and sadly once the labels take their cut there really wouldn't be much left of the artists.

BenjiSujang4• 11 years ago

Only few things prevent greedy companies from pushing further and further. Bad PR is one of them. I don't care about Tayler Swift, but I think the behaviour of the big players are extremly questionable.

spanishcow• 11 years ago

Looks like a publicity stunt...

BenjiSujang4• 11 years ago

Yeah, but landed on the roof. The damage to Apple is done.

mfoy_5• 11 years ago

"Damage" being a ton of publicity and PR about their new streaming service? I wish I could be so "damaged".

6stringmerc• 11 years ago

Huh, well how about that. In my last comments on the subject I postulated that Apple could easily afford the money to pay artists/labels during that period. Apparently they could not afford to not pay, image wise.

Not sure if it sounds more cynical or stereotypical on my part, but I'd guess that there's a lot of overlap between Taylor Swift fans and Apple's target market. Good move in the long run for Apple, and in the short term they get to play it off like collaboration. I don't see it as anything but a disagreement between two juggernauts, The Taylor Swift Corporate Entertainment Empire Wordwide (TM) and Apple's Jimmy Iovene Music Experience (TM), but I'll take my pennies and keep on truckin'.

brisance• 11 years ago

Some professional photographer is calling Taylor Swift out on her hypocrisy.

http://nextshark.com/an-open-response-to-taylor-swifts-rant-...

mfoy_5• 11 years ago

Isn't that apples to oranges? I would think it goes like this:

I want to have pictures taken of me during a performance. But I cannot take pictures of myself while performing. So I pay a photographer to take those pictures for me. They are my pictures. I don't care that you took them, I don't care WHO took them. They are mine because I paid you to take them for me.

Just like when an app developer makes an app on their own, they get to reap the rewards. If someone pays you to create an app for them, don't complain when it takes off and you don't get paid royalties on top of that. You also don't get to sell that app again on the side.

goatforce5• 11 years ago

So I pay a photographer to take those pictures for me.

She isn't paying them.

This is for press photographers who want to go to her concert and take pictures of her performing.

CPLX• 11 years ago

That rant is absurd. If you are a photographer and you want to take photos of a famous musician on a very expensive and well produced stage you have to do it by her rules.

You can take photos of a model you pick on a stage you create and then you get to write the rules. Or you can even take a photo of Taylor Swift in a public place like a street or airport without any permission or rights issues.

You just can't take photos inside her private, for profit, and expensive to produce stage show unless you agree to her terms. You also can't walk on to a movie set with your own video camera and have the rights to that footage either.

On what planet is this surprising or problematic?

Navarr• 11 years ago

This was posted as an HN article and was subsequently deemed irrelevant due to the incredibly different nature of their jobs.

Mostly that, no, photographers shouldn't be able to do whatever they want with photographs of Taylor Swift without her permission. That's how you ruin your brand image.

hoopd• 11 years ago

Isn't that missing the point?

The entire argument was that they were demanding rights to use the photographer's work in the future for free. There was a non-commercial clause but its wording was a bit strange (is publicity for a brand like Taylor Swift ever non-commerical?)

pinaceae• 11 years ago

this was a BRILLIANT pr orchestration.

blogs, articles, etc all over the globe were written about apple music, for free. would have been far more expensive to buy all that airtime than this little scandal.

so taylor swift gets more publicity, apple music is now an established brand name, everyone and their dog knows about their pricing model - holy shit. hats off to the apple team, playing the outrage-piano like no other.

doppp2• 11 years ago

This. It's highly unlikely that some SVP would respond so swiftly (no pun intended) to a pop star.

kincardine7• 11 years ago

I think it's more unlikely that a change in business model would happen so quickly.

Given public presence and the way they are steering Apple Music, the personal response - regardless of planning - is less surprising.

tptacek2• 11 years ago

Eddie Cue is the public point person at Apple for Apple Music; he's the person most likely to respond to a concern about the service.

_nedR3• 11 years ago

I am pretty sure that the SVP was on a conference call with a dozen Record company SVPs, one of whom said "You wanna go nuclear on this! There you go, We sent a tweet through Taylor's account"

edit : typos

smackfu7• 11 years ago

That pop star has 59.3M Twitter followers.

smackfu7• 11 years ago

If it was a PR move, why would they capitulate so fast, and on a Sunday? The story is basically done now, a week before the service launches.

I mean, it's not even a trending story on Facebook or Twitter on Monday morning!

d_theorist4• 11 years ago

Actually it is trending on Twitter. Don't know about FB.

zyb09• 11 years ago

Those sneaky bastards, no way I believe this whole thing wasn't prearranged with Taylor Swift. Apple has been subject to public outcries over their greedy business models lots of times, but never did they give in so soon and easily. Either T.Swift is some kind of head honcho of the music industry, and Apple genuinely has to respect her statement, or this whole thing was prearranged for PR.

vinceguidry• 11 years ago

I think you're severely underestimating Taylor Swift's clout in the music industry. She's the biggest artist since Katy Perry, and Katy Perry was the biggest artist since Michael Jackson.

legacy2013• 11 years ago

Taylor Swift is by far the most influential person in the music industry right now. Ignoring her when trying to launch a new music service in this competitive market would have disastrous results, even for Apple

mhomde2• 11 years ago

Which one do you think is more likely:

a) "Oh gosh, apparently having the artists/labels taking the monetary risk for us for trying to acquire a strategic stranglehold on the music industry was bad, we should do the right thing!"

b) "Argh! the backlash is bigger than we anticipated and Taylor Swift is causing too much negative PR. Quickly, change our minds before our service and future music profits are doomed. We'll make it back some other way somewhere down the line"

Doing the right thing because you have to is better than not doing it I guess, but I tend to measure a company on whether they'd try the same thing again if they could get away with it... and Apple definitively would.

d_theorist4• 11 years ago

I think you've missed the point a bit. The third (pretty likely) scenario that you don't mention is that they planned the whole exchange.

GBond• 11 years ago

One can speculate the whole thing was planned.

notNow2• 11 years ago

Brilliant indeed albeit with one caveat, this news story gonna die off in matter of 72 hrs top unless Apple or one of its stooges pours more gas to the fire to sustain the action and publicity.

legohead• 11 years ago

I didn't know Apple needed PR.. I do know that Apple is greedy, however.

And there's nothing to say Apple wont change its terms later on.

KeytarHero2• 11 years ago

I doubt it. Planning to piss off the musicians you depend on and then backtrack is a risky move; it has the potential to erode public trust somewhat.

JonFish85• 11 years ago

While I don't know how orchestrated this might have been, it's interesting that Apple seemed to cave to Taylor Swift's letter immediately, whereas Spotify basically told her that she's welcome back whenever she changes her mind. Apple had to know that Taylor Swift would be pretty on top of this, since she had already made her feelings known about the lack of compensation for streaming music (when she pulled her songs from Spotify).

dhagz• 11 years ago

Well it works out for Apple, they now look like the company that will fight to keep one of the most popular artists on their platform, and in turn work to make the best deal possible for independent musicians. Never mind if they actually care, it's all about appearances.

jusben13692• 11 years ago

The only brilliance in the PR here is the speed with which Apple moved to avoid looking like the richest company in the world screwing over struggling artists globally. Never going to win that one. I suspect Taylor had back channelled her displeasure and only went public when Apple took too long/didn't agree. So they had time to crunch the numbers and think it through and moved quickly once it hit the public arena.

_nedR3• 11 years ago

What is sad here, is that in this case the "struggling artist" is Taylor Swift (more likely the record company she is associated with), and that was probably the only reason why Apple actually bothered to do anything about it. Based on Apple's treatment of developers I can imagine how Indie artist's concerns fare in Apple's consideration. Here is an article about this same issue which was raised by an indie artist a couple of days ago (http://www.macrumors.com/2015/06/19/apple-not-coercing-indie...)

But yes that is part of the brilliance of Apple PR.

insertion• 11 years ago

I find it highly unlikely this was a coordinated PR stunt. If revealed, this would damage the reputation of both parties, particularly Taylor. On a risk-adjusted basis, it’s not worth it for such established players to do this sort of thing. There’s also the secondary issue of how Apple would initially raise this topic. What are the chances she would have wanted to play along? Maybe she has a close friend at Apple who’d feel safe suggesting this, but it seems unlikely.

It’s very hard to exactly predict how stories will develop. What if lots of other artists came out and publicly supported Taylor’s stance? Then, even if Taylor agreed to Apple’s next deal, the other artists might not. In which case, Apple finds itself in a pickle and nobody would be suggesting that this was coordinated – even if it was.

guelo• 11 years ago

No has even heard of Google's streaming music service. Their marketing team is completely outclassed.

caffeinewriter• 11 years ago

Interestingly enough, in my experience with Google Music, they've outclassed almost every other service I've used in both user experience, and technical innovation. (Spotify, Rdio, Grooveshark, Pandora, and I'm sure I'm forgetting one or two) However, that's just my opinion and personal experience. Plus, this little debacle will definitely give me pause should I ever consider Apple Music when switching music services in the future.

dghughes• 11 years ago

And 60 million 14 year-old girls "swifties" commenting on each one and blasting anyone who dares say anything remotely bad about Taylor Swift.

If they knew of HN it would be a flame war (to used a 90s reference) in here.

vonklaus• 11 years ago

Yesterday, I made the comment that there has to be a negative value of this PR and the infrastructure to combat it. IF the value to just capitulating and paying these artists earns them more goodwill, more artists, and in turn more subscribers/profit it is an easy trade. I am sure some actuary /ies must have run the numbers and figured this out.

ristin• 11 years ago

Yeah Really Brilliant

JohnGB• 11 years ago

Am I then only one that noticed that they didn't say they would be paying the same during the free trial as after the free trial. They could be paying a flat $0.01 fee to each artist regardless of plays, and everything Apple has said would still apply.

I want to know "how much" they will be paying.

smackfu7• 11 years ago

Yeah, that's the rub. Their normal payout is a percentage of revenue, so if there is no revenue...

mightykan• 11 years ago

"It can’t be at the same rate that Apple is paying them after free users become subscribers, since Apple is paying out a percentage of revenue once subscribers start paying. Instead, he says, Apple will pay rights holders on a per-stream basis, the amount of which he won’t disclose.” [1]

[1] http://recode.net/2015/06/21/apple-says-it-will-pay-taylor-s...

vbezhenar• 11 years ago

It's obvious that it was planned from the beginning. It's not possible to do such decisions "on the fly" for Apple monster. There are billions of dollars involved in such a decision. Well played, Apple, I must admit.

What I wonder is how do they prevent me from regging new account every 3 monthes? Why would I pay them a single cent if I can spend few minutes once a 3 months and listen to their library for free?

donjh• 11 years ago

It will be tightly coupled to your AppleID I'm sure. For everyday iOS users, the act of re-registering your device to a new AppleID would be too involved to be worth it. For users on other devices, though, I'm not sure what Apple could do to prevent this.

slackstation• 11 years ago

Has anyone actually read Taylor Swift's post? She praises Apple and basically says that this one small area, isn't great.

This isn't exactly a total take-down and I wouldn't be surprised if this was orchestrated. Even if it isn't. It's the kind of deep PR/Advertising that you rarely get the chance to pay for, let alone afford. And the cost of almost negligible in comparison. Even then, they have a "special" rate during those first three months.

Apple is a beast at making money.

kelukelugames• 11 years ago

Praising someone greatly and then making one tiny suggestion is a standard method to give criticism. It is also most effective in being taken seriously.

pluckytree• 11 years ago

Although this is rumored, it seems highly plausible:

Had the contracts they signed with the labels included paying royalties, they would be giving away a product far below cost for 3 months. Spotify and friends could file a complaint that this is anti-competitive behavior. It could be argued that Apple used its financial power to lose money for three months to thwart real competition in the market.

Amazon was accused of doing this will digital books by selling them all below cost, although ironically Apple was the one that got in trouble.

What happens now is unclear. Can Apple argue they didn’t intend to be anti-competitive from the beginning or will people go after them anyways. I suspect the latter is guaranteed.

seasoup• 11 years ago

Is Apple's royalty structure set up so that if I pay $10/month and I listen to just Justin Bieber, then Justin Bieber gets the royalties from that $10, or is my 1,000 Justin Bieber plays added onto the plays of everyone else and royalties averaged out evenly? If it's the latter, this change doesn't impact Apple economically, it just adjusts the payouts percentages.

smackfu7• 11 years ago

Here's the contract: http://www.digitalmusicnews.com/permalink/2015/06/17/fk-it-h...

Subscription service stuff is at the end.

I assume they will be changing this section: "Fees for Trials and Comp Accounts. For the sake of clarity, for Trial Users, and for Comp Accounts that ITUNES provides on a gratis basis, no license or royalty fees, including Fees, will be due to COMPANY."

dang• 11 years ago

Related discussion at https://news.ycombinator.com/item?id=9756009.

Apple Says “We Hear You Taylor Swift”, Will Pay Musicians During Free Trial

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