Apple Music royalties

A report that Apple would pay music labels a reduced royalty rate during the three-month free trial of Apple Music has been confirmed by labels who spoke to the NY Times. Apple had originally planned to pay them nothing before an open letter from Taylor Swift and complaints from others led to a swift change of plan.

For each song that is streamed free, Apple will pay 0.2 cent for the use of recordings, a rate that music executives said was roughly comparable to the free tiers from services like Spotify. This rate does not include a smaller payment for songwriting rights that goes to music publishers.

Spotify bases its royalty payment for free users on a 35% share, half of the 70% it pays for tracks streamed by paid subscribers … 
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Just as we thought Apple’s u-turn would put an end to the controversy over its original intention to pay artists nothing during the free trial of Apple Music, a statement to the WSJ suggests that there is still time for the saga to turn into a PR nightmare.

While everyone assumed Apple would now be paying artists and publishers the 71.5% royalty rate from day one, it appears the actual amount paid during the free trial will be lower.

Apple declined to say how much it plans to pay during the trial period, though it said the rate will increase once customers start paying for subscriptions.

Eddy Cue’s tweets in response to Taylor Swift’s open letter said only that Apple “will pay artist for streaming” and “will always make sure artists are paid,” stopping short of promising to pay the full royalty rate from day one … 
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