Apple announced Apple Music at the WWDC ’15 keynote address. I didn’t think too much of it at the time. It seems like a good streaming service that will gain traction: it’s going to be on every Apple device you can imagine.
It will launch with a three month trial period, which I thought was generous. That’s enough time for the service to stop being a novelty and start being a part of daily behavior. But buried in the details was the fact that Apple would not be paying any royalties to rights-holders during the 3 month trial. I thought that was an interesting at the time, maybe worth a blog post or two. Then Taylor Swift wrote a letter.
There’d been some minor objections to the trial period already. But Taylor’s letter was the real spark. Apple changed its mind over the course of the weekend. They will now pay rights-holders during the three month trial.
The Real Issue
It’s important to note that the whole to-do was a negotiation. Taylor Swift wasn’t fighting for the little guy; she wanted Apple to pay her for the right to play her most popular album to date. There’s nothing wrong with that. Artists should get paid. If they can find a way to get paid more they should do so. Just don’t make Swift Taylor out to be a crusader for the indie artist.
A second note: Rights-holders, not artists will be the ones benefitting from this. Again, this isn’t right or wrong, it’s just the way business works. Taylor may own digital and streaming rights to her music. She’s shown a lot of business savvy in the past. She may have worked hard to secure those rights during her contract negotiations. A lot of smaller artists don’t own those rights, their music labels do.
I haven’t researched this in the music industry, because that’s not where I work. In the book industry, publishers pay authors an advance on signing a book deal. An author doesn’t make any royalties until the publisher has earned back the advance. Getting paid for the 3 month trial will help those artists start earning royalty checks sooner, but that money isn’t going to the artist until they earn the advance.
The point is, most artists on a record deal have already been paid.
Contracts are always negotiable and anything could happen. Music labels aren’t in the business of giving up any more than they have to, though. I doubt most artists will ever see significant revenue from streaming services.
There are a lot of free things on the internet. All over the internet. I produce a couple of podcasts you can go download for free. You could contribute to my Patreon or buy one of my books if you wanted to, but the podcasts are there for you to listen to at will.
A lot of authors offer the first book in their series for free. That’s not to say the book has no value or that it didn’t take any effort to create. It means the author is confident that if you read the first one you’ll want to buy the second one and the third one. It’s a way to build a fan base, and more importantly, a customer base.
Take a look at any number of (what we used to call) bloggers(these people do a whole lot more than blog now, I’m not sure what we should call them). Almost every one of them will offer a free ebook or course or video. They offer some type of product for free (or for the cost of your email address) because they want to show that their products work (and get into your inbox). They want to provide the user with value so that the user feels compelled to provide value in return.
So why hasn’t the music industry latched on to this idea? The streaming services themselves appear to be an exception, but I see no other industry that’s as obsessed with extracting every last penny from every piece of content they own. I’m not saying other entertainment industries are giving all their content away, but I frequently see the first episode of a TV show available on Amazon Prime. When was the last time you saw the first track of an album available for free?
My point is, I think the piracy craze last decade combined with the transition from physical to digital music sales freaked the music industry out to no end. Their actions are governed by a compulsive need to ensure that someone pays for every byte, that every strum of a guitar earns them revenue directly. There are a few exceptions, 9 Inch Nails’ Trent Reznor(himself a part of the Apple Music announcement) has been progressive in this field. But for every Reznor there’s a Metallica and a Beatles. At least.
This 3 month trial isn’t a big deal. Apple has the money, they obviously want to provide a lengthy trial period more than they want to keep that money. They’ll shell out for 3 months and I have no doubt they’ll make that money back with a successful product. Don’t believe the pundits that will call Apple Music a failure. Apple’s playing with house money here. It’s going to be hard for them to lose the music game at this point.