“A close look at the iTunes licensing agreement for indie labels shows iTunes Radio royalties have limited downside and strong upside,” Glenn Peoples reports for Billboard. “The minimum royalty calculation ensures labels will be paid a decent royalty until iTunes Radio becomes effective at generating revenue. iTunes Radio could be very valuable to labels if Apple can convince listeners to buy downloads at a healthy clip.”
“If iTunes Radio becomes extremely effective at generating revenue against its listener hours, it will share its success with labels,” Peoples reports. “The minimum royalty will exceed the standard royalty when iTunes becomes 171% more effective at revenue generation than Pandora is right now. In other words, [in] the event iTunes Radio revenues go through the roof, labels will not be stuck with a small share of the revenue.”
Peoples reports, “iTunes Radio’s impact really soars when download purchases are taken into account. The radio service will have a “buy now” button to allow the listener to purchase a song at iTunes while it’s playing on iTunes Radio. Since a single download is worth far more than a single stream, purchases can have a huge impact… Labels will find iTunes Radio royalties falling within a comfortable range. The per-stream royalty won’t be lower than the 0.12 statutory rate received from pureplay webcasters (as part of the Webcaster Settlement Act). If Apple can get just one download out of 1,000 streams, labels will get at least nearly twice that statutory rate.”
Read more in the full article here.
Related articles:
Apple’s entire, non-negotiable iTunes Radio and iTunes Store contract posted online – June 29, 2013
Apple circulates iTunes Radio terms to indie record labels – June 27, 2013
Apple patent application reveals new iTunes Radio features – June 27, 2013
Why Apple chose iTunes Radio instead of a catalog streaming service – June 13, 2013
Apple announces iTunes Radio – launches this fall – June 10, 2013
“… labels will get at least nearly twice that statutory rate.”
That one gave me a start; darned dyslexia.
Hmmm, iTunes Radio *is* still in its infancy. LOL.
I want iTunes Radio right now!
“Billboard: Apple’s iTunes Radio royalties offer indie labels strong upside”
Not according to Apple hater Rocco Pendola.
http://www.thestreet.com/story/11965932/1/apple-should-be-ashamed-of-itself.html?cm_ven=RSSFeed
He did his very best to spin the contracts in a negative light.
Rocco Pendola is an infiltrator and a financially motivated back stabber, he endeared himself to naive Apple fans by initially singing the praise of Apple and gaining their confidence with flattering praise and commentary, before pulling the switcheroo and attacking with unsubstantiated FUD.
Another imposter in a long line of impostors on MDN and the Apple covering press, just like the one who uses the same tactic and calls himself GM here. Yeah, there are others who stick out like pimples too.
Read the article, then read the comments… and savor them, as they are 100% against the author. This man is a joke. He has ZERO credibility.
And the comments aren’t just “shut up, Apple-hater”. They do a good job of proving that Pendola has no clue what he’s writing about.
——RM
D’oh! I put my reply in the wrong place. This was meant as a reply to “R Eunson” linking to Rocco Pendola’s hit piece.
——RM
iTunes ready sounds better and better to me. A good deal for everyone!