Apple Streaming Music Indy Compensation Ping!
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Posted on 06/25/2015 6:02:49 AM PDT by Mad Dawgg
The likes of Merlin, AIM and IMPALA have endorsed the Cupertino giant’s new offer to the indies, after Eddy Cue did an about-turn and offered them royalty compensation for the platform’s upcoming three-month trial.
But the question on the lips of the industry is a familiar one… how much?
Reports suggest that the indies are receiving the equivalent of $0.002 per stream from Apple, and MBW’s sources corroborate this.
But there’s an important extra detail, numerous indies have told us: this is actually a pre-tax figure, certainly in Europe.
That means that in the UK, for instance, the $0.002 would see a further 20% knocked off in VAT – down to $0.0016.
And it will be even worse news in the likes of Ireland (24%), Norway/Sweden (25%), Spin (21%) and Italy (22%).
We know that Apple is paying 58% of Apple Music income to labels in the US – with 13.5% going to publishers – so some very rough maths would suggest that independent publishers would get somewhere around $0.00047 per stream for the three-month free trial.
(Excerpt) Read more at musicbusinessworldwide.com ...
That rate is better than any of the other streaming services pay. . . and in answer to your question, the split is artists 72%, Apple 28%. And what is not being said here is that these are on-demand plays. . . and that indies and major artists are being paid equally.
No they aren’t, do you know how much a radio station pays a performer?? ZERO, that’s right, nothing. I was around when Napster and digital downloading was going to be the death of music.
What you have is just another change to an industry brought about by technology, this isn’t anything new, all industries deal with this, and the music industry will as well. The biggest earnings for an artist have ALWAYS been live performances... why do you think bands tour? to sell albums? Not really, that’s why their labels want them to tour, to promote album/song sales, but the reality is nearly all performers make the overwhelming amount of their actual money from touring, this has been true since long long before streaming services.
Streaming is taking the place of radio, which performers never got paid for, the songwriters and producers did, but not the actual performers, radio has always been nothing but a promotional tool for performers.
Streaming is the future, anyone who thinks its not is living in the past... and the reality is, that model means financials have to adjust. This isn’t apple saying , hey Mr. artist we are going to screw you, apple is paying what it realistically can pay and make such an operation profitable. Artists are free to demand more money and they will find they aren’t going to make anything.. this isn’t Apple’s doing, this is financial reality.
Go look at Netflix, for $8 a month its users have instant access to a huge entertainment library... the value of 3 minutes of being entertained for an individual today is not much, and that’s the reality.. Content is ubiquitous.. folks are willing to pay something for it, but they aren’t going to pay a fortune. If you think the artist should get a penny every time one of their songs is streamed you are looking at a model where folks are going to pay $50 a month to have the service, and guess what, not going to happen.
The entire industry is changing, to blame Apple for this is nonsense. Apple will make money, but I guarantee when its all said and done once this service is up and running, their profits per song streamed will be measured as a miniscule amount of their revenue.
This is the new reality, thinking its the 1970s is silly, and blaming some business or another for it being different is equally silly.
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Red, it is NOT a download service, it is a streaming music service similar to Netflix. Downloading is locked out. While some people could convert the downloaded files to mp3s they would not be in the same quality as the stream nor would that be an easy proposition to accomplish. "Most People" could not gain access to do it.
It will not go up. Apple has not done that with any of their services.
actually, it's a tad bit higher.
Thank you, HamiltonJay. These guys do not understand that the Streaming Radio portion of Apple's business has to stand on it's own profit and loss books according to Generally Accepted Accounting Principles (GAAP) rules, which I have been trying to tell them for some time. . . and that was the reason behind the original contract that had the requirement that the payments for the trial period would be AFTER the completion of the trial period when the revenue stream started. Apple was not intending to "stiff" the artists or to "cheat" any of them. They were merely following the rules of GAAP, waiting until they had sufficient income flow to pay out of the revenue stream of the proper pocket.
Tunecore can get a CD made for 1.28 shipped and that is for just 1000 CDs you can get better pricing on larger quantities. iTunes IIRC charges 9.95 for a Digital Album and takes 30% so yeah basic math shows us an Indie can undersell iTunes and still make more money on a physical sale of a CD.
Apple is facilitating getting the music TO the listener. . . which for the musician is a big thing. If their music is not heard, it is nothing. If music is played in a forest, and there is no one there to hear it, and appreciate it, AND PAY FOR IT, it is merely noise, of no VALUE. Apple is making that musician's music available to be heard by a potential audience in the millions. Where else could he or she gain such an audience AND BE PAID FOR IT? That is what YOU fail to understand. Apple is rendering an extremely valuable service to the musicians and deserves to be paid and appreciated for doing it. Instead, you turn and bite the hand that is offering you this invaluable opportunity!
In the past, independent artists went from station to station begging and pleading to get them to air their music for FREE to get themselves heard by a small number of listeners to get word of mouth talking about their talent. . . and you guys are complaining. SHEESH!
Ahh the internet beat them to that.
Indies have been Able to get their music to millions without Apple or any of the streaming services.
Apple is not doing anything new or groundbreaking they are as usual jumping on the band wagon.
Cue: We've been hearing a lot of concern from indie artists about not getting paid during the three-month trial period, which was never our intent. We never looked at it as not paying them. We had originally negotiated these deals based on paying them a higher royalty rate on an ongoing basis to compensate for this brief time. But when I woke up this morning and saw what Taylor had written, it really solidified that we needed to make a change. And so that's why we decided we will now pay artists during the trial period and we'll also keep the royalty rate at the higher rate.
Now that you have those CDs, you have to market and sell them. That is not a trivial thing. Self-produced CDs are NOT easy to sell. There are costs attached to marketing and selling. I would be willing to bet that it will take months or even years to sell 1000 CDs for most Indys because they have to do it retail. Getting them into a retail chain is almost impossible. Selling them one at a time requires you HIRE somebody to stand there and sell them at a concert venue. Now you have minimum wage plus benefits to contend with. . . in multiple venues. That requires an accountant to keep track of. Your costs escalate. Doing this on a one-off is not where the big bucks are for your average Indy.
Making money through streaming is a better model. The indy receives a check in the mail once a month, once a quarter and carries it to the bank. . . or it's direct deposited. Done. He or she can concentrate on making music not running a business selling CDs.
Finally, WHO USES CDs ANYMORE?
You keep repeating that litany as if it meant anything. All it means is that APPLE WAS PAYING THE INDIES at 72% and Apple was keeping count during the 90day period. How many times do I have to tell you I have READ THE CONTRACT and it does not say what you claim it says???????? Apple was NOT going to steal anything from anyone or stiff anyone. If it had, no one would have signed them. This was all about the timing of the payments.
Cue: "We've been hearing a lot of concern from indie artists about not getting paid during the three-month trial period, which was never our intent."
That is very plain language. "Not getting paid during the three-month trial period is NOT not getting paid at all, which you keep insisting was the intent of Apple to steal a few hundred dollars from every indy artist who signed these contracts. . . and I keep telling you Apple would not and did not intend to do that, which is exactly what the contracts and Eddy Cue has explicitly stated. The contracts laid out WHEN the artists would be paid for their trial period streams which was after the trial period ended.
Your repeated and repeated posting of that paragraph will not change your misunderstanding of that intent. . . nor will it change the explicit wording in the contracts.
Actually it is as easy as clicking a few buttons and bang you are part of Amazon's On Demand CD service. But see the idea of indies selling their CDs is to do so at their gigs. And yes they make more money doing so than with iTines who can't fill that niche and Indies make a nice chunk of change doing so Especially when the bundle a tshirt and poster into the deal. And Indie fans like it because the money is going directly to the band.
"Finally, WHO USES CDs ANYMORE?"
Well Indies do though they also use data sticks with all sots of extras on them (Digital Art etc.) One of the reasons Indie Fans love CDs and such is because they can get their items Autographed. Myself I still prefer my music purchases to be CDs that is why I buy from Amazon. I get the CD AND I get the digital copy free added to my Amazon cloud which does not count towards my data limit. I like having a physical copy knowing I can give all that great music to my kids. Has anyone figured out how to put an iTunes account into a will yet?
If I see a band live and I like them I always buy their CD at the show knowing they get the bucks I rarely buy digital downloads.
No Eddie made it clear he said he thought the extra couple of percent made up for not getting paid in the three month period. That is until Taylor Swift set him straight.
How many times do I have to state I have read the contracts? That is NOT what is in them!
What part of selling "one-off is expensive" do you fail to understand? That is not going to garner good profits for anyone. That is the single most expensive way to market anything. . . So WHAT if the fans can get an autograph. That is just more wasted time on the part of the artist as he stands there signing autographs one at a time. . . for pennies. You really do not know what you are talking about. . . when it comes to mass marketing.
I was also NOT talking about "Amazon On-Demand CD" service. . . that is not selling through a retail outlet. Your cluelessness about business is abysmal.
Having their music available on a streaming service provides them more exposure in ONE DAY than they can get in a year of "Gigs". . . but you, for some reason, cannot grasp this.
If I see a band live and I like them I always buy their CD at the show knowing they get the bucks I rarely buy digital downloads.
You, my Freepfriend, are a rarity. . . and your favorite indy band is NOT going to go anywhere on the few like you. . . or it will take their entire lives to get there.
I've been a musician, but I've also been a CEO. . . and you don't understand much of this at all.
Right because Amazon is not a retail outlet. It is THE Online retail outlet.
The tend to sell a largish amount of CDs AND they will help you market it. So it is very easy to get your physical CD on the largest online retailer in the world. If that is what you wish.
See you are very clueless about the music biz especially for Indies. Indies love physical sales because they are direct to the fans no middle men. You can make a very good living being a good live preforming band without the need to market yourself like an iGadget. You don't have to be on the top of the charts or played on Radio constantly to make a respectable living without selling your soul to some large corp for pennies on the dollar.
The friends I have in the indies make a chunk of change on physical sales because they are very good at putting out a quality product whether it be t-shirts posters or CDs etc. They work hard on their craft and they end up being well rewarded for their efforts most don't even mess with digital sales and none mess with streaming because the payouts are so small. Yet they make a good income and have no other job save for making music and playing live.
"Having their music available on a streaming service provides them more exposure in ONE DAY than they can get in a year of "Gigs". . . but you, for some reason, cannot grasp this."
They can get far more exposure using youtube and Facebook and twitter being none charge for their services and you can do all sorts of great linkage and behind the scenes pieces etc.
Streaming doesn't come close to the exposure the big three of social media can provide and none of them require customers to pay a monthly fee.
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