Apple Music has revealed that it pays artists a penny for every song streamed on the service, roughly double the rate paid by Spotify.
Apple’s streaming service opened Friday in a letter to artists and labels about its payment structure, in an effort to show they are artist-friendly and recruit more subscribers, the Wall Street Journal reported.
The move is seen as a dig at Spotify, which pays about half to a third of a cent per song – though Spotify generates a lot more revenue for the industry overall, as it has more users streaming more songs.
Spotify says it has about 155 million paid subscribers and another 190 million using the free ad-supported version, while estimates put Apple Music’s paid subscriber base at around 72 million.
Apple Music has revealed that it pays artists a penny for every song streamed on the service, roughly double the rate paid by Spotify
Apple’s letter to the industry was seen as a shot at Spotify. Above, Apple CEO Tim Cook is seen on the left and Spotify CEO Daniel Ek on the right
Launched in 2015, Apple Music immediately became involved in a high-profile feud with Taylor Swift, who said she would withhold her latest album from the service due to Apple’s policy of not paying artists for songs streamed during its free trial. new users.
Apple quickly reversed policy, announcing it would pay artists for streams during a trial period, but the tiff left a lingering resentment in the industry.
The impact of the pandemic, which had a devastating impact on concert revenues critical to modern musicians, has placed even more emphasis on how streaming service revenues are distributed among rightsholders.
With Friday’s letter, Apple hopes to show it is artist-friendly, winning goodwill, and hopefully new subscribers.
“As the discussion about streaming royalties continues, we believe it is important to share our values,” Apple said in its letter.
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We believe that we should pay every creator the same rate, that a play has a value, and that creators should never have to pay for showing ‘music in the first place on his service,’ the letter continued.
Streaming services do not pay artists directly, but send money to record labels, publishers and distributors, who share the revenue with the artists based on their various contracts.
In the letter, Apple says it pays 52 percent of its subscription revenue, or 52 cents of every dollar, to all record companies.
Spotify pays about 50 to 53 cents of the dollar on labels, and about 75 to 80 percent of all of its revenue goes to some form of rightholder, including publishers and distributors.
“If Apple can pay a penny per stream, then Spotify can, too,” said the Union of Musicians and Allied Workers, which competes to provide artists with a larger share of streaming revenue.
Spotify’s per-song rate is lower because the average Spotify subscriber listens to more music per month than listeners on other services.
However, Spotify in general brings in much more revenue for the industry as its subscriber base is larger than Apple Music.
The Union of Musicians and Allied Workers weighed in on Apple’s letter, saying that all music streamers should pay at least one cent per stream.
“If Apple can pay a cent per stream, then Spotify can, too,” said the union.
We also know that paying a penny per stream is just a starting point to right the injustice of the streaming economy. This adjustment alone will not render the music industry fair or fair enough. ‘