“You don’t have to pay anything to try Apple’s new streaming music service, since the company will offer a free three-month trial when it launches at the end of June,” Peter Kafka reports for Re/code.
“But if you stick around after that, you’ll need to pay $10 a month for the on-demand, all-you-can-eat subscription service,” Kafka reports. “And Apple will end up passing along more than $7 of that to music labels, music publishers and other music owners.”
“According to Robert Kondrk, the Apple executive who negotiates music deals along with media boss Eddy Cue: In the U.S., Apple will pay music owners 71.5 percent of Apple Music’s subscription revenue,” Kafka reports. “Outside the U.S., the number will fluctuate, but will average around 73 percent, he told Re/code in an interview. Executives at labels Apple is working with confirmed the figures.”
Read more in the full article here.
MacDailyNews Take: That’s a tad bit better than Spotify, plus Apple Music doesn’t give it away forever like Spotify. Music labels and musicians will likely reward Apple over Spotify with important exclusives. As Spotify loses paying subscribers to Apple Music, it’s only going to get worse for Spotify.
SEE ALSO:
Does Apple Music’s June 30th launch mark the beginning of the end for Spotify? – June 12, 2015
Lefsetz: Apple Music is toast – June 12, 2015
Apple Music’s secret weapon that almost no one’s talking about – June 11, 2015
Apple confirms that Apple Music will stream at 256kbps – June 11, 2015
Spotify founder: Uh ok, we don’t need to be number one in music streaming – June 11, 2015
Why Apple Music will gut and publicly execute Spotify – June 10, 2015
Spotify CEO claims to be ‘ok’ with Apple Music – June 9, 2015
Jimmy Iovine and Eddy Cue: Apple Music gunning for Spotify, YouTube, and terrestrial radio – June 9, 2015
Something about Apple Music betraying Apple’s brilliance by ignoring ‘The Harry Potter Theory of Marketing’ or some such nonsense – June 9, 2015
Bob Lefsetz on Apple Music: What team is Jimmy Iovine on? – June 9, 2015
Apple Music’s huge advantage over Spotify – June 9, 2015
Apple Music is a major mess and it won’t beat Spotify or something – June 9, 2015
When Apple Music arrives, what happens to iTunes Match? – June 9, 2015
What Apple Music says about how Apple views musicians – June 8, 2015
Apple’s revolutionary Apple Music just might prove its skeptics wrong – June 8, 2015
Apple unveils revolutionary Apple Music service – June 8, 2015
All the pundits talk about is how Spotify has greater market share but absolutely nothing about whether Spotify is achieving profitability. It appears as though the pundits completely ignore that. They start talking about how AppleMusic isn’t cheap enough to overtake Spotify’s subscriber base. Why should any company lose money to gain market share if they don’t have to? I’d say its practically a given AppleMusic will get a higher number of paying subscribers that what Spotify has due to Apple’s large and loyal customer base. AppleMusic simply needs enough subscribers to stay profitable and as a decent service for Apple device users. Apple has no need to try to put Spotify or Pandora out of business. I’m sure they can do that much without Apple’s help. I would think the record labels would be happy if “freemium” tiers went away.
What’s annoying is how all these pundits are already writing articles about the disadvantages of AppleMusic before the service has gone into use. So stupid. Only the consumers will be the judge of how good or bad AppleMusic is. I believe the AppleMusic family/group plan for $14.99 will pull in a lot of subscriptions. If Apple is only willing to charge $14.99 for five users, then they must really be profiting on $9.99 single user subscriptions. How can these know-it-all pundits call for AppleMusic failure before average consumers even try it? I’d think AppleMusic would have to be extraordinarily bad in order for it to fail. It doesn’t seem likely to happen in my opinion.
The “free” and profitless market share blinds many, completely neglecting the needs of business sustainability and the need to feed the artists. Ridiculous disingenuousness at the expense of others making a living, on any level.
Freetards want it all don’t they and don’t care who suffers as a result? Oh but hey if it were their wallet taking a hit we’d see some major ‘tude correction.
Well said, Peter! It’s actually a relief to hear some sanity in the middle of all this. In the mad rush for cheaper, cheaper, cheaper!!! or free, free, free!!! business sustainability and the needs of others are being (almost) completely forgotten.
The way the world’s going I wonder why anyone – not just musicians, but film makers, authors, set designers, costume designers, painters, etc. etc. – will bother to create at a professional level any more. All we’ll be left with is amateur dreck, and the freetards will have the audacity to complain about the lack of quality.
Well said right back atcha Des! A moment of salient thought between action and consequence.
I don’t see any target aimed at Spotify here. Offer music service, charge market price, give 70% to provider, keep 30% for service.
This is the same model as is with Apps. No conspiracy necessary.
Investigations are douchbaggery.
Speaking of “the need to feed the artists”…
I don’t know exactly what an artist gets paid per stream as it seems to vary a lot, but it seems to be something in the vicinity of $0.003 or $0.004. Here in Australia (one of the most expensive countries in the world to live in) the Henderson poverty line put poverty for a single person at 10,372,750 $0.004 streams per week in the December quarter 2014.
So I don’t know how many artists out there would be popular enough to even reach the poverty line with income from streaming. Probably very very few, if any.
And that’s the poverty line, not the level that would enable an artist to afford such luxuries as equipment, recording studio fees, etc.
I’m completely at a loss trying to figure out why any artist will bother to record any more. A 5-minute demo of a live performance on YouTube would show the world what they can do, so why bother with the massive time and expense of recording when it’ll never ever be worth it?
There will not be $9.99/month from me to be divided. I am not going to rent music.