Register FAQ / Rules Forum Spy Search Today's Posts Mark Forums Read
Go Back   MacRumors Forums > News and Article Discussion > MacRumors.com News Discussion

Reply
 
Thread Tools Search this Thread Display Modes
Old Jun 26, 2013, 09:04 PM   #1
MacRumors
macrumors bot
 
Join Date: Apr 2001
Apple's iTunes Radio Terms With Record Labels Revealed




The Wall Street Journal is reporting that Apple sent its iTunes Radio terms to independent record labels last week and the paper was able to review a copy of the contract. It dictates that Apple will pay record labels both in royalties on individual song plays, as well as how much advertising Apple is able to sell.
Quote:
During iTunes Radio's first year, Apple will pay a label 0.13 cents each time a song is played, as well as 15% of net advertising revenue, proportionate to a given label's share of the music played on iTunes. In the second year, that bumps up to 0.14 cents per listen, plus 19% of ad revenue.
That's compared to the 0.12 cents -- $0.0012 -- that Pandora pays labels per play, although the paper says Apple will be paying publishers more than twice as much in royalties than Pandora. For streaming music, publishers and record labels are paid independently.

There are also restrictions in place that allow Apple to not pay royalties. Some song plays are unpaid if they are already in a listener's iTunes library or part of an album they own, tracks selected by iTunes for special promotion, or if listeners skip a song before the 20 second mark. However, Apple can only avoid royalties for two songs per hour per user.

And while these terms were sent out to independent music labels, the WSJ claims they are similar to the terms major labels like Universal Music Group and Warner Music have signed.

Apple doesn't expect iTunes Radio to generate much ad revenue, but hopes it will drive iTunes sales and help sell more iPhones, iPods and other Apple hardware. The company does hope it can help grow the iAd mobile advertising platform.

Finally, the paper says the terms include "several references to terms for the use of music in talk, weather, sports and news programming" on iTunes Radio and that Apple wouldn't have to pay royalties on music snippets used in those types of programming.

The WSJ believes it is "unlikely Apple will invest much in creating such programming, given that it has long shied from creating its own content".

The details offer a look into the terms long debated in the negotiation process between Apple and music labels. Apple reportedly agreed to higher royalty rates in early April, and then signed deals with the major labels in time to announce the new service at the Worldwide Developers Conference in early June.

Article Link: Apple's iTunes Radio Terms With Record Labels Revealed
MacRumors is offline   1 Reply With Quote
Old Jun 26, 2013, 09:07 PM   #2
komodrone
Banned
 
Join Date: Apr 2011
A bit weird...why not use the licenses Lala got for the radio streams?
komodrone is offline   0 Reply With Quote
Old Jun 26, 2013, 09:08 PM   #3
levitynyc
macrumors 6502a
 
Join Date: Aug 2006
Still don't see a point in Apple duplicating what Pandora already does so well.

Also, can someone please take iAd out back and shoot it?
levitynyc is offline   5 Reply With Quote
Old Jun 26, 2013, 09:08 PM   #4
rabidz7
Banned
 
Join Date: Jun 2012
Location: Isla De Juventud, south Havana provence, Cincinnati Ohio
Why not just pay for your music. Everytime someone plays a song on these phony radio/spotify services, the artist makes about a cent.
Some one will definitely find a way to remove the ads.
rabidz7 is offline   0 Reply With Quote
Old Jun 26, 2013, 09:11 PM   #5
singhjeet29
macrumors regular
 
Join Date: Oct 2008
Quote:
Originally Posted by levitynyc View Post
Still don't see a point in Apple duplicating what Pandora already does so well.

Also, can someone please take iAd out back and shoot it?
...
Quote:
Apple doesn't expect iTunes Radio to generate much ad revenue, but hopes it will drive iTunes sales and help sell more iPhones, iPods and other Apple hardware. The company does hope it can help grow the iAd mobile advertising platform.
This will reach more people than Pandora has ever had, overnight. And the music industry wants that.
__________________
15" uMBP i7, 8GB RAM, 500GB HDD@7200rpm, booting from an Intel X25-M 160GB SSD in the optibay
singhjeet29 is offline   21 Reply With Quote
Old Jun 26, 2013, 09:12 PM   #6
gaximus
macrumors regular
 
Join Date: Oct 2011
In the beta it won't play song with explicit lyrics. It bleeps them out, very annoying. Hopefully they will put in an option for this.
I would also like to be able to shuffle different stations together like on pandora, can't do that either.
gaximus is offline   1 Reply With Quote
Old Jun 26, 2013, 09:13 PM   #7
Sky Blue
Guest
 
Join Date: Jan 2005
i like iTunes Radio, much easier to use than Pandora. No ads for iTunes Match customers too!
Sky Blue is offline   15 Reply With Quote
Old Jun 26, 2013, 09:15 PM   #8
imgonephishin
macrumors regular
 
Join Date: Jan 2003
Quote:
Originally Posted by rabidz7 View Post
Everytime someone plays a song on these phony radio/spotify services, the artist makes about a cent.
That's pretty impressive given that the streaming companies are only paying the labels about one tenth of one cent per song.

Quote:
Originally Posted by rabidz7 View Post
Why not just pay for your music.
And who are you to tell other people how they would like to listen to their music? If people prefer listening to streaming radio, they'll do so. Markets will respond and the contracts will be hammered out. It's just the way the world works.
imgonephishin is offline   15 Reply With Quote
Old Jun 26, 2013, 09:17 PM   #9
avanpelt
macrumors 6502a
 
Join Date: Jun 2010
If Apple can only avoid paying royalties on two songs per hour, does that mean the end-user can only skip two songs per hour?
avanpelt is offline   1 Reply With Quote
Old Jun 26, 2013, 09:19 PM   #10
appleguy123
macrumors 603
 
appleguy123's Avatar
 
Join Date: Apr 2009
Location: 15 minutes in the future
Quote:
Originally Posted by avanpelt View Post
If Apple can only avoid paying royalties on two songs per hour, does that mean the end-user can only skip two songs per hour?
In the beta it's more than that.
__________________
[Steve Jobs was] brave enough to think differently, bold enough to believe he could change the world, and talented enough to do it. -Barack Obama
appleguy123 is offline   1 Reply With Quote
Old Jun 26, 2013, 09:28 PM   #11
lk400
macrumors 6502
 
Join Date: Aug 2012
Quote:
Originally Posted by singhjeet29 View Post
...


This will reach more people than Pandora has ever had, overnight. And the music industry wants that.
And yet they want a higher percentage of each play by those more people. And I bet its because of them that its only in the US at launch. The music industry ideally wants to go back to pre MP3 and pre CD burner days.
lk400 is offline   0 Reply With Quote
Old Jun 26, 2013, 09:28 PM   #12
lunaoso
macrumors 65816
 
lunaoso's Avatar
 
Join Date: Sep 2012
Location: New England, USA
Quote:
Originally Posted by avanpelt View Post
If Apple can only avoid paying royalties on two songs per hour, does that mean the end-user can only skip two songs per hour?
I'm pretty sure you get to skip 5 or 6 per hour, so Apple gets exempted from having to pay for 2 of those 5 or 6.
lunaoso is offline   1 Reply With Quote
Old Jun 26, 2013, 09:32 PM   #13
SJism23
macrumors 6502a
 
Join Date: Nov 2012
Location: Canada
What's odd to me is that Apple is paying higher royalties than competitors. I thought that Apple could leverage deals with the music labels/publishers because of their strong iOS ecosystem and established iTunes presence in the music industry.
__________________
15" MacBook Pro (early 2011), 2.0 GHz i7, 16 GB RAM; iPad 4, 32 GB; iPhone 5s, 32 GB
SJism23 is offline   1 Reply With Quote
Old Jun 26, 2013, 09:34 PM   #14
basesloaded190
macrumors 68030
 
basesloaded190's Avatar
 
Join Date: Oct 2007
Location: Wisconsin
Send a message via AIM to basesloaded190
Quote:
Originally Posted by rabidz7 View Post
Why not just pay for your music. Everytime someone plays a song on these phony radio/spotify services, the artist makes about a cent.
Some one will definitely find a way to remove the ads.
Or we could all go back to stealing music if you'd like?
__________________
2011 MacBook Pro 15 HR Anti-Glare, Etymotic ER-4p, iPhone 4 32GB
Twitter
basesloaded190 is offline   8 Reply With Quote
Old Jun 26, 2013, 09:39 PM   #15
DisMyMac
macrumors 65816
 
DisMyMac's Avatar
 
Join Date: Sep 2009
I have a hunch there are similar deals between Hollywood and file storage sites. Really, how else could they survive?
DisMyMac is offline   1 Reply With Quote
Old Jun 26, 2013, 09:47 PM   #16
TennisandMusic
Guest
 
Join Date: Aug 2008
These royalty rates are interesting. Looks like it could cost Apple a fortune?
TennisandMusic is offline   2 Reply With Quote
Old Jun 26, 2013, 10:09 PM   #17
ZeRoLiMiT
macrumors 6502
 
Join Date: Jun 2010
Location: Southern California
Apple is not getting as much as Pandora but how many people will switch to iTunes radio for $25.00 a year for iTunes Match + iTunes Radio or pay $4.00 a month for pandora? I bet A LOT of people are going to switch I know I did and a lot of people I know will be doing the same.
__________________
Dad: 13' Macbook Pro 2012 8GB Ram, 128 SSD
iPhone 5S, iPad4, Apple TV3,
Mom:13' Macbook Air 2011 4 GB Ram, iPhone 5,iPad Mini
Daughter:iPad Mini
ZeRoLiMiT is offline   5 Reply With Quote
Old Jun 26, 2013, 10:15 PM   #18
ftaok
macrumors 601
 
Join Date: Jan 2002
Location: East Coast
I'm cheap, so I'll be using iTunes radio free. I'll put up with listening to an occasional ad. No problem. What I won't put up with are the pop up ads that cover up the app interface and other visual content (I'm looking at you, Pandora)

In the end, I'll switch from pandora Lite to iTunes radio because of the larger catalog. If there's no pop up ads, then thats a bonus. iTunes radio might be the feature that gets me to subscribe to match.
ftaok is offline   2 Reply With Quote
Old Jun 26, 2013, 10:27 PM   #19
nsfw
macrumors regular
 
Join Date: Aug 2009
Quote:
Originally Posted by rabidz7 View Post
Why not just pay for your music. Everytime someone plays a song on these phony radio/spotify services, the artist makes about a cent.
Some one will definitely find a way to remove the ads.
A cent? Are you kidding? It takes 7 1/2 plays of a song to make one cent. (.01)
You know how much it takes to make $5,000? 3,846,153 plays.

I recommend you go google what Pink Floyd had to say about Pandora, et all.

I've talked to a couple smaller bands. They are big enough to play venues in most big cities and travel the world non-stop playing. They said they are making no money off their music anymore. It's all about getting out there and playing live and getting gate money as well as getting some extra money from merch they sell at shows.

To the extreme, you can read what Metallica wrote. Basically, they have to tour every year or they lose money on their infrastructure of management, attorneys, staff, studio equipment bills, etc..

It will be interesting to see what happens in the near future as more and more people move to these streaming services or just steal music outright.
nsfw is offline   3 Reply With Quote
Old Jun 26, 2013, 10:35 PM   #20
Jaro65
macrumors 68040
 
Jaro65's Avatar
 
Join Date: Mar 2009
Location: Seattle, WA
Send a message via Skype™ to Jaro65
Quote:
Originally Posted by singhjeet29 View Post
...


This will reach more people than Pandora has ever had, overnight. And the music industry wants that.
So then why did they have to pay more than Pandora?
__________________
rMBP | MBP | MBA | ACD | iPad | iPhone | ATV | iPods | Senn HD 650
Jaro65 is offline   1 Reply With Quote
Old Jun 26, 2013, 10:35 PM   #21
damir00
macrumors 6502a
 
Join Date: Oct 2011
Wait - what? - after all the negotiations, Apple is paying *more* than Pandora?
damir00 is offline   1 Reply With Quote
Old Jun 26, 2013, 10:36 PM   #22
lightz39
macrumors regular
 
Join Date: Nov 2012
I really hope this is available in canada... we take it in the you know what more often than not with stuff like this. I already have satellite radio and nearly 21,000 songs so it won't kill me if I can't use it. But I'm always on the look out for new music and this seems like a great way to find new stuff.
__________________
15" Retina Macbook Pro 2.7/16/768
lightz39 is offline   0 Reply With Quote
Old Jun 26, 2013, 10:37 PM   #23
Jessica Lares
macrumors 603
 
Jessica Lares's Avatar
 
Join Date: Oct 2009
Location: Near Dallas, Texas, USA
iTunes Radio is great so far. Unlike Pandora and Slacker, it actually plays music that if you listen to that artist, you'd actually listen to. I haven't had the need to use the skip feature until after like 20 songs or so. That's REALLY going to help set them apart from the others, having that HUGE database of purchases and knowing their audience so well because of it.

People don't want to DISCOVER music, they just want to hear the stuff they like, and these other services don't seem to get that.
__________________
Have You Hugged Your Mac Today?
Daily Expressions | iMac G4 | Late 2011 13" MacBook Pro | iPod Nano (7G) | iPad Mini | iPod Touch (5G) | iPhone 5S
Jessica Lares is offline   2 Reply With Quote
Old Jun 26, 2013, 10:38 PM   #24
Ichabod.
macrumors member
 
Join Date: Oct 2012
Rough, I assume the music industry will now try to leverage this to charge Pandora more as well.

Oligopolies are hard to fight.
Ichabod. is offline   0 Reply With Quote
Old Jun 26, 2013, 10:39 PM   #25
mdriftmeyer
macrumors 68020
 
mdriftmeyer's Avatar
 
Join Date: Feb 2004
Location: Pacific Northwest
Quote:
Originally Posted by TennisandMusic View Post
These royalty rates are interesting. Looks like it could cost Apple a fortune?
It's not going to cost Apple a dime. They have just created a new stream of revenue for their advertising platform and with more purchases at the iTunes stores for actual album sales from listening to the artists its a win/win for Apple and the publishers.
mdriftmeyer is offline   0 Reply With Quote

Reply
MacRumors Forums > News and Article Discussion > MacRumors.com News Discussion

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Similar Threads
thread Thread Starter Forum Replies Last Post
Apple Pushing Record Labels for More Exclusive Beyonce-Like iTunes Albums MacRumors MacRumors.com News Discussion 97 Jun 24, 2014 04:10 PM
Apple Announces iTunes Radio, Ad-Supported, Free for iTunes Match Subscribers MacRumors iOS Blog Discussion 86 Jan 7, 2014 10:32 AM
Apple Releases iTunes 11.1 Beta 1 to Developers, Includes iTunes Radio MacRumors Mac Blog Discussion 73 Aug 16, 2013 06:39 PM
Apple Revises iTunes Terms and Conditions to Allow Educational iTunes Accounts for Children Under 13 MacRumors MacRumors.com News Discussion 50 Aug 5, 2013 04:15 PM
Apple Close to Striking Deal with Record Labels for iRadio MacRumors MacRumors.com News Discussion 154 Apr 9, 2013 07:24 PM

Forum Jump

All times are GMT -5. The time now is 06:18 PM.

Mac Rumors | Mac | iPhone | iPhone Game Reviews | iPhone Apps

Mobile Version | Fixed | Fluid | Fluid HD
Copyright 2002-2013, MacRumors.com, LLC