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Apple Confirms 71.5% Revenue Sharing for Apple Music, No Royalties During Trial Period

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Apple Music iOS 9 IconApple vice president of iTunes content Robert Kondrk has confirmed to Re/code that the Cupertino-based company will share 71.5% of Apple Music revenue with music owners in the United States.

That number will be slightly higher outside of the United States, averaging around 73%, but Apple will pay no royalties during the three-month free trial period in return for paying a few percentage points extra.

"Apple won’t pay music owners anything for the songs that are streamed during Apple Music’s three-month trial period, a bone of contention with music labels during negotiations for the new service. But Kondrk says Apple’s payouts are a few percentage points higher than the industry standard, in part to account for the lengthy trial period; most paid subscription services offer a free one-month trial."

The payments will be primarily sent to record labels and publishers that own the rights to songs and their underlying compositions, meaning that the royalties will not necessarily line the pockets of musicians directly. Artists often have their own individual deals with the record label they are signed to, so their payouts are often dependant on the terms of their contracts.

Apple paying seven-tenths of every dollar to rights holders is the standard rate paid by other streaming music services such as market leader Spotify, although Apple Music may be more lucrative for record labels due to its absence of a free ad-supported tier. Spotify argues that Apple also offers free streaming music through iTunes Radio and its upcoming Beats 1 global radio station.

Apple Music was unveiled last week as an all-in-one streaming music service, live global radio station and social platform for artists to connect with fans. The subscription-based service will be available June 30 for $9.99 per month after a three-month free trial period for iPhone, iPad, iPod touch, Mac and PC. Apple TV and Android versions of the service will be available in the fall.

Tags: Apple Music Guide, Spotify

Top Rated Comments

H
hlfway2anywhere
141 months ago
I'm sure a lot of people will have opinions about the unpaid trial, but as a musician myself, I'd rather give Apple Music users 3 free months of my music with higher payouts indefinitely after the trial than have my music on other streaming services with lower payouts all around. its my understanding that as an artist or label, if you don't like it, you're free to distribute your music elsewhere.

"No royalties during trial period" - what a shabby business model where artists are pre-financing Apple's market entry. :mad:

I know this is probably industry standard, and due to negotiations with the labels, but for me, that means I will not buy Apple Music. I simply do not want to support such a business model.
Please don't buy Apple Music. Buy all of the music you listen to and do not 'pirate' music and you will be doing a huge favor to the artists you support.
Score: 14 Votes (Like | Disagree)
ugahairydawgs Avatar
ugahairydawgs
141 months ago
"No royalties during trial period" - what a shabby business model where artists are pre-financing Apple's market entry. :mad:

I know this is probably industry standard, and due to negotiations with the labels, but for me, that means I will not buy Apple Music. I simply do not want to support such a business model.
If there's no revenue coming there are no funds to pay out to the artist. It would be different if Apple was running ads during this the trial periods, but they aren't.
Score: 11 Votes (Like | Disagree)
crenz Avatar
crenz
141 months ago
"No royalties during trial period" - what a shabby business model where artists are pre-financing Apple's market entry. :mad:

I know this is probably industry standard, and due to negotiations with the labels, but for me, that means I will not buy Apple Music. I simply do not want to support such a business model.
Score: 9 Votes (Like | Disagree)
C
citysnaps
141 months ago
"No royalties during trial period" - what a shabby business model where artists are pre-financing Apple's market entry. :mad:

I know this is probably industry standard, and due to negotiations with the labels, but for me, that means I will not buy Apple Music. I simply do not want to support such a business model.
Then do your duty and make a personal choice to not use the trial period and simply sign up with a subscription on day one.
Score: 7 Votes (Like | Disagree)
BillyBobBongo Avatar
BillyBobBongo
141 months ago
The payments will be primarily sent to record labels and publishers that own the rights to songs and their underlying compositions, meaning that the royalties will not necessarily line the pockets of musicians directly.
Please don't buy Apple Music. Buy all of the music you listen to and do not 'pirate' music and you will be doing a huge favor to the artists you support.
Go to gigs, that's how you can support artists.
Score: 7 Votes (Like | Disagree)
T
Thunderhawks
141 months ago
"No royalties during trial period" - what a shabby business model where artists are pre-financing Apple's market entry. :mad:

I know this is probably industry standard, and due to negotiations with the labels, but for me, that means I will not buy Apple Music. I simply do not want to support such a business model.
And other companies' one month trial does the same, but Apple pays a higher percentage to make up for that.
You viewpoint is shortsighted.
If the free 3 months trial generates a lot of extra subscribers , then the payout is obviously greater and in the end the artists get more money (depending on their deals)
Score: 6 Votes (Like | Disagree)
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