Apple Music to Pay Two-Tenths of a Cent Per Stream During Trial Period

Ben Sisario, reporting for the NYT:

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; Apple is still negotiating with many publishers over those terms, several publishing companies confirmed on Wednesday.

According to the music executives, these rates would apply to all labels.

For independents, the negotiations with Apple are seen as a victory, allowing thousands of small labels to be part of Apple Music and earn money when people listen to their songs.

Maybe I’m vastly underestimating just how many songs are going to be streamed from Apple Music, but my gut feeling is that there aren’t many artists who are going to make serious money at just two-tenths of a cent per song streamed.

Let’s say Apple Music generates 100 million plays per day from customers on the free trial. At $0.002 per play, that’s $200,000 in payments to the artists and record labels, or about $6 million per month. That’s couch change for Apple.

Maybe I’m way off, and the number of plays will be more like 1 billion per day?

Thursday, 25 June 2015