
Apple Says “We Hear You Taylor Swift”, Will Pay Musicians During Free Trial - 666_howitzer
http://techcrunch.com/2015/06/21/apple-music-free-trial/#.d9n1qq:0AVt
======
pinaceae
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.

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

~~~
kincardine
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.

~~~
crusso
I would give the edge to this being a PR ploy, but then again, I'm sure that
Apple had different financial models on the table when they were building this
product.

They might have been going with the "shared risk" model of free up front play,
but bigger payouts to the artists on the subscriptions - but still had their
"Apple takes the risk" on the front end, then payouts are smaller on the back
end.

Then when artists grumbled about the shared risk model, they kicked in with
the alternative model.

------
SchizoDuckie
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"'

~~~
kincardine
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
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?

~~~
kincardine
Oh, absolutely. This is freebie PR for everyone involved.

What I meant to imply is that the PR is only valuable because it is a musician
with the brand value (and public presence) of Taylor Swift.

And, what I mean by that is that if smaller brand musicians complained (as I
think would have been inevitable) nothing would change until a larger brand
also complained (which would also have been inevitable).

~~~
d_theorist
It seems like you're assuming this was reactive?

Seems far more likely that this exchange was orchestrated between Apple and
TS.

------
kincardine
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...

~~~
twoodfin
...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
"Bank shot" +"Eddie Cue" = nice billiards pun!

------
slackstation
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
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.

------
JohnGB
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.

~~~
mightykan
"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...](http://recode.net/2015/06/21/apple-says-it-will-pay-taylor-swift-
for-free-streams-after-all/)

------
oddevan
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. :)

~~~
FireBeyond
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.

~~~
Joky
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.

~~~
FireBeyond
So you do make a valid point, but I think your estimation of the impact is
vastly overrated, too.

Number of users who will pay for Apple Music with no trial or a 1 month trial
(as per Spotify, Rdio, et al) = x,

Number of users who would not pay for Apple Music with no trial but will after
a 3 month free trial = 2x?

Doubtful. I think the order of magnitude in people for whom the three month
trial is in the order of single digit percentages, at most (because I'm sure
other music services have A/B tested this). "1 month vs 3 month trial" is not
revolutionary nor out of left field, and I can guarantee if the there was a
100% increase in customer base by Spotify offering a three month trial, they
would be doing that right now.

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

[http://nextshark.com/an-open-response-to-taylor-swifts-
rant-...](http://nextshark.com/an-open-response-to-taylor-swifts-rant-against-
apple/)

~~~
mfoy_
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
> 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.

~~~
mfoy_
I won't pretend to understand the exact business model, but it sounds like
this is an entirely different can of worms. Unless there is a lot more
clarification, I don't see why this is an issue, though.

The few people I know who have photographed a concert in some professional
capacity have done so for someone else on a paid contract. Usually the
performer or the venue... it's kind of like a wedding photographer in that
sense (in my mind, at least) and I'd be appalled if a wedding photographer
started making a fuss because he doesn't own the rights to the pictures.

Of course, if Swift (or the venue) is not paying the photographers (and she
isn't), then clearly there must be some financial motivation for them to go do
this anyways, at which point you gotta weigh the pros and cons of taking
pictures you won't own the rights to...

~~~
LnxPrgr3
I'd be surprised—I'm pretty sure the photographer _does_ own the rights to
photos they took, unless he/she explicitly signs them away, so there's nothing
to fuss about.

That said, I'd expect to be thrown out more often than not if I started
showing up to random weddings as an uninvited photographer. No one has to let
me take pictures in their private space, but they might do so with terms
attached.

------
seasoup
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.

~~~
smackfu
Here's the contract: [http://www.digitalmusicnews.com/permalink/2015/06/17/fk-
it-h...](http://www.digitalmusicnews.com/permalink/2015/06/17/fk-it-heres-the-
entire-apple-music-contract-for-indies)

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."

------
noobermin
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
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.

~~~
BenjiSujang
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.

------
pluckytree
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.

------
vonklaus
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.

------
FreakyT
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.

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

I presume you work for free?

------
6stringmerc
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'.

------
dang
Related discussion at
[https://news.ycombinator.com/item?id=9756009](https://news.ycombinator.com/item?id=9756009).

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

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

~~~
laumars
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.

~~~
Tloewald
Well, sadly, no-one is going to pay artists unless they're the rights holders.

------
vbezhenar
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
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.

------
spanishcow
Looks like a publicity stunt...

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

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

------
BenjiSujang
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.

------
ristin
Yeah Really Brilliant

------
tostitos1979
Fantastic! What's next? How about paying software engineers during full day
interviews?

~~~
mseebach
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.

------
zxcvcxz
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
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?

~~~
zxcvcxz
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.

------
Yuioup
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
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.

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

