Apple decides to pay rights holders in Apple Music free trial

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Following outcry from various artists in the record industry over its decision not to pay rights holder during the Apple Music free trial, Apple software and services chief Eddy Cue said that the company has changed its mind and will pay royalties while users try out the service.

Apple Music will pay out during free trial

Cue made the announcement on Twitter, saying that Apple Music “will pay artists for streaming, even during customer’s free trial period”. He also confirmed to tech site Re/code that the rights holders will receive a per-stream fee in the trial phase, with payments switching to a percent of revenue when users become paying subscribers.

Cue said the change was due to complaints from artists such as Taylor Swift, and labels like Beggars Group, which includes Adele and Vampire Weekend. Both were concerned about the loss of income from offering free music, in terms of lower download sales and falling marketshare from Apple Music rivals that do pay.

The decision to change was made by Cue and Apple Chief Tim Cook, according to Cue. Cue also said he spoke to Swift personally, but it’s not clear yet whether the change will prompt her to allow her latest album to be streamed using the service.

“I did reach out to Taylor today, and talked to her, and let her know that we heard her concerns, and wanted her to know that we were making changes”m Cue said. “She was thrilled to hear from us and that we were making the change, and we were grateful for that”.

Apple offers labels a higher than normal royalty rate, which Cue said would not change, in exchange for withholding payments in the trial period. In the US, rights holders will receive 71.5% of subscription revenue, 1.5% higher than the standard in the industry of 70%, and that number may also rise as high as 73%.

SOURCE: Apple Insider.

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