71.5% of Apple Music's U.S. revenue will go to record labels, songwriters and performers
posted by Alan F. / Jun 16, 2015, 1:34 AM
For every dollar that Apple Music will receive from subscribers in the U.S., 71.5% will go to songwriters, labels, artists and others with the rights to songs streamed on the service. Outside of the U.S., that number goes north to as high as 73%. Those figures come from Apple's Robert Kondrk who negotiated the deals with the labels and the artists for Apple, along with Eddy Cue. Industry executives have confirmed the figures.
While Apple's payout rate is a little higher than the industry average, the tech titan will pay no royalties on songs streamed during a user's three month free trial. Those familiar with the negotiations between Apple and the recording labels say that this did not go over well with the record companies. Most paid streaming music services offer only a one-month trial period. But Apple increased its payout on average in order to make up for the months of free trials it is offering.
Apple might still run into legal trouble, as it tried during negotiations to force the labels into pressuring rival streamer Spotify to drop its free ad-supported tier of service. 45 million of Spotify's 60 million subscribers use the company's free level of service. If Apple's decision to go with a three month trial is successful, Spotify could decide to follow suit and eliminate its free ad-supported tier.
Spotify spokesman Jonathan Prince notes that Apple does offer free music on its iTunes Radio service, and will also offer free tunes on its upcoming Beats 1 radio service. Both of those service pay labels less than Apple Music does. Prince says, "We pay royalties on every single listen, including trial offers and our mobile free custom radio service, and that adds up to approximately 70 percent of our total revenues, as it always has." But Apple believes that it will end up with more than the 20 million paid subscribers that Spotify has, meaning that the music industry will have more of its bread buttered by Apple than by Spotify.
source: Re/code via AppleInsider
Greeedy Apple, 71%, that's it? why dont you give 100% of who actually made music. Apple just using real artists to make money from instead of making something great themselves. And the worst part, Apple probably sells the most music for these artists than any other retailer (of music) there is. Will all the money they make, they should pay out more to artists. "...Great artists steal" right?
posted on Jun 16, 2015, 1:38 AM 2
Posts: 6; Member since: Dec 28, 2013
you have to understand the record labels want to sell on itunes and amazon because that's where most people purchase digital media. it's not stealing because apple doesn't have to host their files and if the record labels feel cheated, they can go have their music sold elsewhere or by themselves. the money shouldn't be paid out more to the artist because there is also fees that are crucial to be paid out first like the mix engineer, master engineer, studio time, director and his crew for the music video, promotions, etc. Artists nowadays understand most of their money made are from advertisements so the money here tends to go to the people who work hard behind the scenes to make the song happen. If your argument is if the artist doesn't sing then the song doesn't happen so they're the backbone, actually no, because most of the instrumentals aren't even made by them nor the lyrics so beats can be bounced to another artists. Examples is a beat made by Jon Bellion who went to send it to Atlantic Records but eventually landed onto Eminem who used it for the song, "Monster".
posted on Jun 16, 2015, 1:59 AM 5
Are you mental? Most of the industry, including Spotify, and many others, give around this number. This is no where near "greedy". You also have no idea how the record industry works. Maybe J. Iovine should promote you and he should step down, since you know it all. Apple on the other hand, is making an amazing music service, which I'm jealous of. I hate them for being so successful.
posted on Jun 16, 2015, 2:32 AM 1
No, you probably misunderstood... They have so much money, they should give us consumers free music on damand (let us pick the tracks) and pay the artists themselves... If they dont do that - they're greedy... Why is apple in business at all is beyond me.
posted on Jun 16, 2015, 2:41 AM 2
Posts: 17312; Member since: Jun 17, 2009
Whoa. They've got to make something off this venture. And there are other costs involved, bandwidth for instance. If they get 20 million subscribers, that $200 million (rounded up) every month, and $142 million of that goes to artists. (Or, I hope it does, and it doesn't go to record companies)
posted on Jun 16, 2015, 3:16 AM 1
Posts: 3061; Member since: Apr 28, 2014
I think he is trying to say, it's about time that Apple gave something back to there customer that get rip off per year on there new Apple products, I say at this time the only good Apple product is the iPad Air 2 but the cost is way to big, you can get a full pc like the Ms s3 for cheaper, I have both an iPad Air 2 64gb and a spro3, so I am not an none fan of Apple , I also have a Samsung s6 edge ( the best phone you can buy)
posted on Jun 16, 2015, 8:26 AM 0
Posts: 894; Member since: Jul 03, 2013
how much does spotify, pandora, and tidal payout?
posted on Jun 16, 2015, 1:39 AM 1
Posts: 2610; Member since: Jan 25, 2009
I've read that 70% is the industry standard
posted on Jun 16, 2015, 1:59 AM 5
Posts: 1276; Member since: Mar 22, 2014
People love Spotify because tney cater to all types of genre, from depressive suicidal Black Metal all the way to Psychedellic Pop.... I wonder if Apple will do the same.... But I doubt it... SPOTIFY is the king of catalogs.... That's why it's so popular
posted on Jun 16, 2015, 2:34 AM 0
Posts: 17312; Member since: Jun 17, 2009
It sounds like Apple isn't expecting the service to take off, if they negotiated a higher backend and zero front end.
posted on Jun 16, 2015, 3:17 AM 1
Posts: 289; Member since: Apr 08, 2013
I think they are proceeding cautiously since it is a venture into an area with well-established competitors. This isn't like the iTunes introduction all those years ago. I would call this a well negotiated deal based not he circumstances.
posted on Jun 16, 2015, 10:41 AM 0
Posts: 21784; Member since: May 28, 2014
I think the payout is good, as long as the majority of it goes to songwriters and performers as opposed to the labels. I know that may be wishful thinking on my part. Not bad, Apple. It is unfortunate, however, that Apple is involved with anti-competitiveness concerning Spotify. Focus on better business practices, Apple.
posted on Jun 16, 2015, 3:25 AM 1
Posts: 3347; Member since: Jul 22, 2014
So if my favorite artist who composed his own song made $3 million worth of streams, he'll make $2.145 million or he still have to share it with his record if he has signed on one? How about the start ups who don't have backing from record agencies and just want to do a bandcamp out of apple music? I support this 71.5% cut but I hope apple will clear the details as I dropped my spotify after what Taylor Swift and other artists call an unfair sharing made by spotify.
posted on Jun 16, 2015, 6:49 AM 0
Posts: 3778; Member since: Sep 30, 2009
something tells me we dont really need to worry about whether these major musicians can pay their electricity bills. Id rather be paid something from streaming than nothing from torrenting.
posted on Jun 16, 2015, 7:04 AM 3
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