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Business News Digital Labels & Publishers
Indie groups endorse revised Apple Music deal
By Chris Cooke | Published on Wednesday 24 June 2015
With less than a week to go until the launch of Apple Music, the indies are now lining up to opt in to the tech giant’s big new streaming service following the firm’s change of heart over the weekend on paying minimum guarantee rates to rights owners even while users are on a three month free trial.
As much previously reported, Apple initially wanted access to music without paying any royalties at all for the full duration of the three month trial period. Which is something the majors seemingly agreed to in return for the promise of a higher revenue share down the line, and possibly other kickbacks we don’t know about, but the indies hit out at the proposal, arguing a royalty free summer on a service that could have an immediate direct hit on download income just wasn’t viable for smaller record companies.
Apple, of course, capitulated on the royalty free trial period on Sunday, partly / mainly / officially / cynically / not-really-at all (delete as you wish) based on the intervention of Taylor Swift, she being signed to indie label Big Machine in the States.
Though it was initially unclear what minimum guarantees Apple would actually be offering during the trial period, with rumour it would be less than the minima being offered on paid for streams (and, of course, Apple exec Eddie Cue’s big tweet on the issue meant he was only technically committed to pay royalties to one artist based on one customer’s usage, thanks to some slack grammar).
But last night, as it was confirmed that Beggars Group – which went public with its criticism of the original Apple Music deal – had now endorsed the revised agreement, indie label digital rights organisation Merlin sent a memo to its members saying that, having seen the revised offer from Apple, it was now happy to back the arrangement.
Merlin boss Charles Caldas wrote: “I am pleased to say that Apple has made a decision to pay for all usage of Apple Music under the free trials on a per-play basis, as well as to modify a number of other terms that members had been communicating directly with Apple about. With these changes, we are happy to support the deal”.
As previously noted, Merlin is not directly involved in the Apple Music contract, because Apple’s deals with the indies pre-date the creation of the digital rights body. In some ways that may well have been the cause of this month’s debacle, in that the tech firm’s proposed deal seemed to land with the indies right at the last minute with minimal consultation, despite the new streaming service having been in development for a year. Had Apple engaged earlier the whole stand-off might have been avoided, and a Merlin relationship would have provided a forum for that engagement. Indeed it seems that the Merlin, alongside Beggars, helped smooth over the problems in the last week.
And Caldas added in his memo: “As you know Merlin has not historically had a direct contract with Apple. Apple has direct deals with our members, and that continues to be the case. Therefore, the amendments referred to above will apply to your existing direct agreements, and the amended contract will shortly appear on iTunes Connect. However, Apple has indicated that in the future they are open to engaging with Merlin as a central point of communication and negotiation for our membership”.
All that said, Apple spinning its change of heart as being a direct response to Swift means that what began as a communications failure might have had an overall positive impact in PR terms – plenty of people outside the industry missed the unveiling of Apple Music earlier this month, but few could have missed the Swift Intervention last weekend. So everyone now knows a new Apple streaming service is launching next week.
Confirming the Apple dispute was now officially over, the World Independent Network issued a statement this morning, with its boss, Alison Wenham, also CEO of the UK’s Association Of Independent Music, saying: “Apple has a long-standing, deep-rooted relationship with the music community and has always helped ensure artists get paid for their work. We think Apple Music provides artists with a business model that’s good for the long-term and we look forward to its launch on 30 Jun”.
As the indie labels all rush to sign up for Apple Music, negotiations still continue on the publishing side of the equation, where some of the majors are on board, but the indies and their collecting societies are still in talks.
Given that songwriters and publishers will also now seemingly get minimum guarantees during the free trial period, no big hold outs are expected here – and it’s not unusual for streaming services to go live without all their publishing deals in place, so the deadline isn’t quite so fixed – though the Apple service launching in so many countries on the same day remains ambitious.
And there remain some questions about how the Beats 1 radio service will be licensed – especially given that performer equitable remuneration would normally be due on that kind of service – and some concerns possibly remain about the royalty free nature of the social network element of Apple Music, aka Connect.
For example, any photos uploaded by the music community won’t be monetised. And as we all know, while Swifty’s always on hand when artists go unpaid, those photographers can, and I quote, “go fuck themselves”. Though I should probably note I’m not actually quoting Taylor Swift there.
Anyway, on the off chance this is the last thing we ever have to say about Apple Music’s licensing deals (and wouldn’t that be a charm?), here are some more quotes for you to snack on, every one of them provided royalty free…
Helen Smith of pan-European labels group IMPALA: “This is a great precedent in any sector on the benefits of working together and taking a stance to achieve a fair result. With 80% of all new releases produced by independent labels, this is also a great result for Apple. Their launch will now incorporate the very music that makes an online service attractive to music fans. The involvement of Merlin is vital considering its fundamental role in strengthening the independent sector. IMPALA has repeatedly called on online platforms to ‘play fair’ and this is an impressive outcome for independent labels and artists”.
Darius Van Arman, Secretly Group: “Apple listened to our community and then revised its music service agreement, demonstrating that it is committed to treating fairly all creators – labels, artists and songwriters. Secretly Group is proud to continue its partnership with Apple towards making music truly indispensable”.
Tom Silverman, Tommy Boy: “Today’s agreement shows Apple’s concern for the issues of the artist and independent label creative community. We look forward to Apple achieving huge and rapid success with its subscription service”.
Oke Gottlich, Finetunes: “The German indie sector is very happy and grateful that Apple has returned to the table, starting a dialogue again and involved our members – the small and middle-sized labels – for making the new Apple Music experience a real game changer for the whole music sector, finally”.
Martin Mills, Beggars Group: “Over the last few days we have had increasingly fruitful discussions with Apple. We are now delighted to say that we are happy to endorse the deal with Apple Music as it now stands, and look forward to being a big part of a very exciting future”.
