Apple Music Wants to Change the Royalty System for Songwriters, Which Could Seriously Hurt Spotify
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Not content to be the king of music downloads; Apple has set out to rule the music streaming business too. Apple Music has gained a fair share of the music streaming customer base and now Apple wants to offer a flat royalty rate to musicians for their music. Ben Sisario from The New York Times writes, “Apple, in a government filing on Friday proposed simplifying the highly complex way that songwriting royalties are paid when it comes to on-demand streaming services like Apple Music, Spotify and Tidal.”
Apple wants to pay songwriters 9.1 cents per 100 streams of each song, replacing the current rules for streaming rates which the company says is too complicated, Sisario states. Spotify seems to be Apple’s target, as a move to streamline royalty rates based on Apple’s proposal would mean a higher royalty rate for Spotify.
Spotify seems like Apple’s main competitor, as Sisario reports, “Last month, Apple said that Apple Music had 15 million subscribers, and Spotify reported that it had 30 million paid users and another 70 million who listen free, with ads.” Bear in mind that Spotify has been around longer than Apple Music, but it’s understandable why some may think Apple is trying to undercut their competitor.
PhoneArena writer Alan F. points out that royalties are a large expense for companies with streaming services. He claims Apple pays $7 for each $9.99 download from iTunes to “songwriters, performers, producers and the music labels.” Other companies might have submitted their own proposals, so writes Alan F. The Federal Government could replace the current complicated system with Apple’s plan, but will likely consider the various proposals and create its own plan based on said proposals, at least in part.
The music streaming wars continue, with Apple trying tirelessly to come out on top. Thankfully, there is a lot of choice in where to stream music. Apple has a chance to change the future of streaming, which may help songwriters and the company.
