Apple Music Royalties During Free Trial May be Lower Than Expected

After posting an open letter to Apple on her Tumblr page about Apple's free streaming policy for its upcoming music service, popular artist Taylor Swift managed to get the company to change course -- Apple now planning to pay artist royalties during its three-month free trial period of Apple Music. But, thanks to a new statement provided to The Wall Street Journal, it appears artists' satisfaction with the policy change could become turbulent again, with the Cupertino-based company suggesting the royalty rate during the free trial period will be somewhat lower than normal.

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Apple declined to say how much it plans to pay during the trial period, though it said the rate will increase once customers start paying for subscriptions. In the first three months of the service’s life there will be no subscriber royalty rate on which to base the rates. The company could find other ways to calculate a rate and is expected to share its plans with music companies soon.

Apple risks raising the ire of Ms. Swift and others if it comes in with what would appear to be a lowball offer.
Attempting to ballpark Apple's possible payment rate for the free trial, The Wall Street Journal compares the Apple service to Spotify's free, ad-supported option, which they point out pays royalties of "about one-fifth of the subscription service." Last December, that was essentially 0.14 of a cent for each listen in the United States, which Spotify had to pay a grand total of $5.8 million for its free tier alone for the month.

If Apple goes in under its traditional 71.5 percent revenue sharing policy -- which is likely to happen given the wording used when speaking to the WSJ -- it could still end up paying out millions of dollars to the various artists, songwriters, and producers that Swift became the defacto figurehead of after Apple listened to her letter over the weekend.

Although, as the WSJ points out, some in the industry appeared content with the original free trial period policy, given Apple's promise of an above-industry standard of 71.5 percent royalty payment, compared to the basic 70 percent payed out by competitors such as Spotify and Google. Apple has yet to comment any further on the issue, but its shifting viewpoint on the topic, so close to Apple Music's launch, is undeniably an impressive feat for Swift.

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60 months ago
Apple regrets their decision to open source Swift already.
Rating: 28 Votes
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60 months ago
It's Apple's decision to have a free trial, not the artist's, so why doesn't Apple deal with it? If Tesco gives you free Kit Kats as part of a promotion, then they don't automatically expect Kit Kat to give them for free to Tesco. If you get a free 1 month trial of Photoshop, that doesn't mean the developers don't get paid for a month, it means Adobe figures it out from their own stock of money.
Rating: 25 Votes
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60 months ago

Somebody ran the numbers on this deal and it takes 8 years for an artist to recoup the benefits. Just pay the royalties Apple.

It's easy to spend money that isn't yours... especially based on unreferenced, mystery sourced figures pulled out of your ass.
Rating: 17 Votes
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60 months ago
Cough up, Apple.

Enough with the nickel and diming.
Rating: 13 Votes
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60 months ago
Somebody ran the numbers on this deal and it takes 8 years for an artist to recoup the benefits. Just pay the royalties Apple.
Rating: 10 Votes
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60 months ago
She's gonna write a song about you if you're not careful Apple.

You don't want that.
Rating: 8 Votes
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60 months ago
Then just let the complaining artists withdraw their music. This is getting so stupid with the back and forth.
Rating: 7 Votes
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60 months ago

Not the same thing. If apple were giving away physical goods, i.e. cds, records or tapes then your argument would hold some weight as the physical goods need to be manufactured. No one is working for free in the music streaming rights. The songs have already been made and no physical goods are being given away.


Biggest ******** i've ever heard.
Rating: 5 Votes
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60 months ago

Then just let the complaining artists withdraw their music. This is getting so stupid with the back and forth.


What's really stupid about this is Apple said people would get 3 months free, and we all applauded. Apple acted like they were doing the consumers a favour, and yet expect the artists not to get paid an appropriate revenue amount - or expect them to do it for free? These are the artists who make Apple music; the whole concept of Apple music would not exist without musicians to put their music on. Furthermore, the artists/recording companies have to pay Apple for the courtesy of getting their music up on there.

Plus Apple aren't exactly short on cash.

How this doesn't leave a slightly sour taste in your mouth is incredible.
Rating: 5 Votes
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60 months ago
In other news

Taylor Swift ruins Apple's above-industry standard of 71.5 percent royalty payment...

...As Apple lowers royalty payment in response to Taylors outburst Indie artists see payouts drop, get pissed at Taylor for not keeping her mouth shut

Rating: 4 Votes
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