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Business News/ Mint-lounge / Features/  Taylor Swift versus Apple Music: The two sides

Taylor Swift versus Apple Music: The two sides

While Swift is standing up for fellow artistes, Apple was just trying to be fair to its competitors

This isn’t the first time Swift has become embroiled in a payment tiff with a streaming service. Photo: Eric Jamison/Invision/APPremium
This isn’t the first time Swift has become embroiled in a payment tiff with a streaming service. Photo: Eric Jamison/Invision/AP

In the latest clash between Apple and musicians over the company’s new music streaming service, pop singer Taylor Swift has said her latest album, 1989, will not be available on Apple Music when the service becomes available to users globally on 30 June.

In an open letter on her Tumblr page on Sunday, Swift said she was staying away because Apple Music was not going to pay artistes royalties for a three-month period.

“I’m sure you are aware that Apple Music will be offering a free 3-month trial to anyone who signs up for the service. I’m not sure you know that Apple Music will not be paying writers, producers, or artistes for those three months," Swift wrote. “I find it to be shocking, disappointing, and completely unlike this historically progressive and generous company."

On Monday morning, Apple’s Senior vice-president of Internet Software and Services, Eddy Cue, tweeted, “#AppleMusic will pay artists for streaming, even during customer’s free trial period." A second tweet followed, “We hear you @taylorswift13 and indie artists. Love, Apple."

But Apple still hasn’t said how these payments will work. Swift hasn’t responded to Cue yet, but she did retweet his first tweet.

This isn’t the first time Swift has become embroiled in a payment tiff with a streaming service. In 2014, she had demanded that Spotify pull her album from the free version of the service. Once it was clear Spotify would not honour such a demand, Swift pulled her entire music catalog from Spotify’s free as well as paid versions.

Swift says, “We don’t ask you for free iPhones, please don’t ask us to provide you with our music for no compensation."

It is easy to agree with that, but it is important to understand the other side too.

Apple has massive cash reserves, and it would not be difficult for it to absorb the cost of paying artistes during the 3-month trial period. However, if Apple does that, it will open itself up to allegations of predatory pricing and anti-competitive behaviour. Other streaming services such as Spotify, Rhapsody and Deezer will complain that Apple has an unfair advantage because it has money. This could even lead to anti-trust lawsuits and investigations by government agencies.

Right now, Apple’s biggest challenge will be to avoid that. It is expected that music labels will also be involved in any payments made to artistes during the free trial period, but whether they absorb any costs (within the license fees, perhaps) remains to be seen. Any anti-trust lawsuits or investigations by the US Department of Justice (DOJ) would inevitably hurt artistes and labels too.

Three of the world’s biggest music labels—Universal Music Group, Sony Music and Warner Music Group—had been satisfied with the terms Apple laid out for its music service. Apple will be paying higher royalties, 71.5-73%, than the 70% industry standard which other streaming services offer.

It would seem that Apple made a deal with the record labels that benefitted a lot of parties, but the outcry from musicians has forced it to change its stance. Critics may slam it for giving in.

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Published: 22 Jun 2015, 03:41 PM IST
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