Apple Music Renegotiates Contract Terms, Luring Independent Labels

Apple Music launches in less than one week, on June 30th. The streaming service is making itself attractive to customers by offering a three-month trial period, hoping that users from established rivals like Spotify drop by and stick around for the premium subscription service. At first, Apple's plan was to forgo paying artists during this trial period. It was a huge blow to independent labels as they are the ones who can't risk giving up a quarter of a year's worth of revenue. Thankfully for artists, Taylor Swift called Apple out on its practices in an open letter, swaying Apple Music to change its tune.

Now, Apple has agreed to pay artists during the three-month trial period on a per-play basis. This puts it back in the realm of feasibility for lower-earning artists who rely income from digital plays. If Apple had failed to secure indie labels, the service would lose the "cool factor" draws others to streaming apps like Spotify. The fewer the bands available on Apple Music, the lower the chance is for users to discover great new music. Streaming services seem quick to forget that smart algorithms for music discovery are a big part of why some people tune in.

Prior to the announcement, Apple was facing a lot of flack from basically anyone who wasn't part of a major label. American independent label group A2IM alerted its members about the dangers that the earlier versions of the contracts would cause, stating that Apple Music would cannibalize iTunes downloads, and therefore, download revenue for artists.

Giving Apple access to a plethora of indie bands is Merlin, a heavy hitting aggregate group that represents more than 20,000 independent labels and distributors, spanning the globe. The indie label managing group Beggars, which handles the like of Adele and Arcade Fire, also signed with Apple Music upon these new terms. So now you can look forward to finding new, indie music if you try out Apple Music, but there is no telling if that will be enough to make users stay.

Source: Billboard