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[dupe] Apple Says “We Hear You Taylor Swift”, Will Pay Musicians During Free Trial (techcrunch.com)
136 points by 666_howitzer on June 22, 2015 | hide | past | web | favorite | 147 comments



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.


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.


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.


That seems highly unlikely, I have a hard time seeing this reflecting well upon Apple, more likely it will leave a sour taste in many people's mouth.

It's not like Apple desperately needs the PR and why risk bad one?


I am not sure how either of you are defining highly likely or unlikely. Have you been in the shoes of the people making the decisions? Have you considered the varying inputs that define the statistical likelihood of the result? I recommend checking out http://rationality.org/workshops/ and perhaps reading http://www.yudkowsky.net/rational/bayes


It's true. I shouldn't have used that word.

Perhaps what I should say is that orchestration seems like a plausible scenario to me. It seems to fit the facts and the outcome benefits both parties.


Planned is probably too strong a word, but I think it's likely that Apple anticipated that there might be pushback on the trial period, so they ready to make a quick change.

Remember when the iPhone debuted at $600 and no subsidy? People said it would never sell at that price. But of course a few did, and then Apple quickly cut the price to $400. Eventually it became $200+subsidy, just like any other smartphone.

Apple seems to start out with their preferred offer and see if it works. If not, they go to the next fallback position. That happens so quickly that it seems clear that they must anticipate it somewhat.


The scenario you give with the iPhone may have been planned marketing as well. It's not that hard to conclude that a $600 dollar cell phone would not sell very well when the iPhone debuted. But releasing it at that price made it "exclusive", creating a lot of consumer desire for the device, then they dropped the price to where people could afford it. So they cashed in on that seed they planted and received a lot of additional news coverage from the price drop.

Apple has teams of people working through this stuff. So while you may be right that it was just a prepared backup plan, it also could've been the plan to begin with.


I'm reminded of the huge success Coke experienced after reintroducing Coca Cola Classic after the disastrous new Coke. When questioned about the whole thing Coke's president Donald Keough said, "Some critics will say Coca-Cola made a marketing mistake. Some cynics will say that we planned the whole thing. The truth is we are not that dumb, and we are not that smart."


I'm not sure what that's actually saying. So they didn't make a mistake?


"We're going to deliberately do something that could piss off most of our musicians, and then backtrack on it. What could go wrong?"


I doubt they tried to plan the whole thing, too much negativity risk involved.


And Swift just happen to complain and withdraw her songs from Spotify, the main company Apple Music is competing against.

Regarding negativity risk. What risk? If you assume they planned this all along then how possibly this could be negative. The only risk they had if they would end up ignoring her.

This was a great PR stunt to make Apple look much better than a competitor and I'm afraid Swift was nothing more than a puppet there.

Do you really think that recording companies would allow Apple to just stream their music without any contracts in place? Or not including something so important as a part of it?


Taylor Swift doesn't have 1989 on any streaming platforms. She also pulled all her music from Spotify because the free tier doesn't pay anything. She has a quite long history at this point of fighting against these streaming services that underpay artists, and encouraging her fans to actually buy her albums.

Why would she be so intent on getting involved with Apple's streaming service?


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.


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.


Part of the point of her letter was that she wasn't a struggling artist, but instead was putting her foot down in the name of the actual struggling artists who couldn't afford to stand up to a giant like Apple.

I suspect you haven't read Taylor Swift's letter, and I suggest you do. It's fairly short.


Oh, In that case, its that PR stunt thing :)

Ok. I have read the letter. But my original point still stands. The only reason Apple bothered to do anything was because Taylor Swift said it.

To come to your point. I don't completely buy the whole "Think about the indie artists!" angle either. She herself says that pretty much everyone she spoke to in the industry (she used the word "social circle") was displeased with Apple's system. I am pretty sure there is self-interest involved. I am also positive her record label is happy with the new arrangement as well.


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.


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!


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


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).


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.


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.


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


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.


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.


I think both of you might be over-estimating what's required to say "Ok actually we're going to meter free trials too just like paid accounts and pay out royalties equally irrespective of account type" Technology wouldn't be difficult and cash isn't an issue.


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.


I know.


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


That pop star has 59.3M Twitter followers.


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.


One can speculate the whole thing was planned.


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


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.


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.


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.


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.


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


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.


The pendulum swings pretty fast these days, but yeah, she's probably the single most influential person in popular culture right now. (I'm not even a fan of her music, but I heard about her blog post from my kids before I saw it on HN.)

It also helps that she wrote a pretty compelling argument that Apple's free trial shouldn't come at the expense of artists.


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"'


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.


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?


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).


It seems like you're assuming this was reactive?

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


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.


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.


> 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.


FWIW, those figures are in dispute. Swift and her management publicly stated that she was getting a lot less from Spotify -- IIRC, under $1 million.

http://www.businessinsider.com/how-much-taylor-swift-earned-...


If I recall, her dispute was in dispute by Spotify CEO.

He asserted her final cut was probably what she was stating, but Spotify's checks to her label were in original $6 million range payouts, and that she should take the issue up with her management if they are taking that much out of her cut.


There's more than one artist on her label (which, by he way, is not owned by her or her family, though they do have a minority stake).


That would be irrelevant for her payouts as an artist. Spotify states that Taylor Swift, the artist (not the label), was pulling down $6 million a year from them alone. Swift stated she was only receiving around $1 million, to which the Spotify CEO referred her to speak with her management because they were clearly taking a massive/majority cut out of her payout.

She's very young, and probably didn't pay much attention to her contracts and such. Even still, 80% is a lot for a label to consume in "management" fees.


"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:_...


She didn't make any of these decisions on her own as a 14 year old. She had two parents with a lot of business savvy and the money to bankroll her career. That gives you the ability to push back against the record company. Ordinarily, if you say "no" to a record company's demands, they drop you and your career is over. Taylor just went out and bought a recording company after RCA wouldn't give her the creative control she wanted (aka "doing more work on her music than most artists") -- most artists don't have that option.


This is not really on point tho is it? TS has put out way more than a standard recording contract. So she'd be like a first round draft pick who is now a free agent with a couple of super bowl mvp's. Its not like anbody cares that peyton and eli manning had their famous dad as there high school coach during contract negotiations. On the merits, she gets alot of credits because she writes alot of her material as well. You can compare somebody like whitney houston (pop star) or even norah jones (jazz) who got their entire career or major break on other people's songs. That givers her dual/multi royalty streams right off the bat and more leverage practically speaking because the label is doing less work production etc (all this well beyong capital $$ loans and stuff).


Right, and the fact that she had the leverage to be able to do that in the first place makes her unlike the vast majority of artists on these services. So for her to play the "I'm not doing this for me, I'm doing this for all the undiscovered artists" card is a bit disingenuous. That's not how the industry works for the majority of artists -- their payouts from Spotify/Apple Music/etc. are so low they aren't focused on that as a revenue stream.

The only artists who really care about these streaming payments are already at the top of the food chain -- the vast majority of artists are just looking to get discovered. One could argue that the presence of big artists on these streaming services makes the platforms more valuable for artists at the bottom by drawing more users to them, but it definitely has created a situation where top artists' albums have value as a product themselves, while albums of lesser-known bands are essentially given away for free to try to build an audience.


To be fair, look at what people like Adele and the british independent labels were saying last week before she chimed in.

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

TS simply agreed with a previously articulated view. She didn't invent the argument.

(edit: They already pulled adele from the contract talks from what I gather, presumably because XL is indeed one of those small labels that breaks original talent, but doesn't have the superstar/financial status of the majors to just eat a full quarter of earnings/working capital. And given how spiky a hit based industry is it might be even worse if one of these companies had to launch a once in a lieftime hit record in this window, etc).


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.


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


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


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.


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.


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....


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.


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?


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.


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.


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


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.


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.


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


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.


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


Are you saying we shouldn't?


Not at all. It's an interesting thought. I doubt it's possible to that extent, though. There certainly are some superstar programmers, but they have nowhere near the reach in mainstream culture as someone like Taylor Swift has.


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.


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...


...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.


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


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


That's what I meant to imply.


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


They only got the major labels - not the indies.


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.


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.


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.


"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...


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


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. :)


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.


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.


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.


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

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


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?


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.


> 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.


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...


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.


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.


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?)


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.


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."


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.


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.


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.


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.


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.


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.


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

I presume you work for free?


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.


> 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.


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'.



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


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


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.


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


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?


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.


Looks like a publicity stunt...


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


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


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.


Yeah Really Brilliant


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


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.


More like a 90 day interview.


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


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


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.


Some people do actually do that.


Maybe they can look at fixing my #staingate screen.


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.


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?


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.


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.


>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.


So what?

It's not about subsidizing smaller artists; it's about not forcing artists to unilaterally eat Apple Music's loss-leading costs.


It's a narrow view: it's about the major label making maths and thinking that it was in their benefit to get as many paying users as possible on the service as quickly as possible, and three months free is a great way to do it.


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.


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.


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


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


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


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




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