Apple Music Spatial Audio Royalties Only Benefit the Biggest Companies, Say Indie Record Labels

[MacRumors]

Independent record labels have expressed concerns about Apple's plans to pay more money for songs recorded in Spatial Audio, claiming it will only benefit the biggest companies in the marketplace, reports the Financial Times.

Last week, Apple announced royalty incentives to encourage music artists and record labels to publish tracks in Spatial Audio. Apple said it will pay up to 10% more in royalties for Spatial Audio, which uses Dolby Atmos technology to replicate an in-person music experience with sound coming from various directions around the listener.

Apple has said that over half of Apple Music subscribers use the feature, and that the bonus is a reward for artists delivering the content, and also compensation to recognize the additional time and effort required to mix in Dolby Atmos.

However, several independent labels told FT that the new incentive will effectively channel cash towards established megastars and away from other musicians who do not have the resources to compete.

"It's literally going to take the money out of independent labels and their artists, to benefit the biggest companies in the marketplace," said a senior executive at a large independent record company.

"It's going to benefit the biggest player, Universal, because they're the ones with the resources to invest in that. Whereas the independent sector . . . we've found it hard to justify the expense of creating spatial masters . . . we're not in the business of chucking money just because Apple is saying you should be spending money on this."

Another independent label told FT that the new deal will badly impact its revenues.

Producing music in Spatial Audio is not cheap. Executives say it costs an extra $1,000 per song, or roughly $10,000 per album, and going back to remaster older tracks can double the costs. Some record executives have also questioned the artistic value of Spatial Audio, with one executive likening it to "hanging a digital 3D version of the 'Mona Lisa' and expecting Louvre patrons to prefer it."

Indie labels say they hope to work with Apple to make changes to the new policy. If those negotiations fail, they would explore legal or regulatory options, said people familiar with the matter who spoke to FT.

Article Link: Apple Music Spatial Audio Royalties Only Benefit the Biggest Companies, Say Indie Record Labels

 

[ersan191]

It sounds like it's a bonus for doing something that costs more to produce, nobody is making them do it. They can just not do it and make the same money as before. Am I missing something here?

 

[neuropsychguy]

How can it hurt the independent labels? Apple is not requiring all songs to be mastered in Spatial Audio. If so, that would hurt the independent labels. Apple is merely offering more money for Spatial Audio tracks. If songs are not in Spatial Audio, labels get paid the same rate as before. If the labels want those standard rates higher, negotiate with Apple. If it doesn't make financial sense to do Spatial Audio mastering, don't do it.

This boils down to you (a business) spending more time, effort, and money to get a higher reward. Just because that might be easier for larger labels (economies of scale) and they might see a benefit, doesn't mean that somehow hurts the smaller labels.

This is like someone who does not work overtime hours complaining that they're not getting paid overtime when other people working overtime are getting paid overtime. Something requires more time and effort (and possibly money) and Apple is providing higher compensation for that.

On the other hand, it is possible that long-term smaller labels might lose artists, if the artists are getting more money from the larger labels due to Spatial Audio. However, indie labels tend to pay artists better than the large labels, so this is unlikely to be an issue. That is unless the artist specifically wants tracks in Spatial Audio. In that case, the indie label could offer lower royalties for that artist due to the extra sound engineering costs.

It's a business. Figure it out.

 

[klasma]

Not sure if this means that Apple is still paying the same amount of royalties in total, and Spacial Audio getting 10% more means everyone else is getting relatively less. Or if they just mean people will listen more to the Spatial Audio titles and thus other titles will suffer.

 

[jayducharme]

with one executive likening it to "hanging a digital 3D version of the 'Mona Lisa' and expecting Louvre patrons to prefer it."

Smart executive.

 

[Timo_Existencia]

...likening it to "hanging a digital 3D version of the 'Mona Lisa' and expecting Louvre patrons to prefer it."

No, this is like that indie label producer introducing the model for the Mona Lisa, and telling everyone that the painting is better than the person.

If those negotiations fail, they would explore legal or regulatory options, said people familiar with the matter who spoke to FT.

Oh please. So many victims in the world now. Apple has forwarded a technology that many people like, and has offered an incentive to artists to produce it. How is that incentive now an obligation to Apple? You want government to now dictate this aspect of business too?

Indie artists can't afford to record in the most expensive studios, can't pay the best session musicians, can't hire the best producers...should that all be legislated too?

This very whining attitude is very anti-indie, actually.

 

[matrix07]

It sounds like it's a bonus for doing something that costs more to produce, nobody is making them do it. They can just not do it and make the same money as before. Am I missing something here?

I believe they fear Apple promotion of Spatial Audio will put users to prefer to listen to that and since they can not afford to make their music SA they will get less royalties from less listening.

I mean, just makes music people love to listen. Problem solved. 🤷🏻‍♂️

 

[Remy149]

This is tiresome how is offering an extra incentive to create music in an additional format causing harm or loses. This would be like independent film makers complaining they can’t compete because they don’t have Dolby vision and atmos.

 

[Abazigal]

It sounds like it's a bonus for doing something that costs more to produce, nobody is making them do it. They can just not do it and make the same money as before. Am I missing something here?

My understand of music streaming revenue is that it's paid out of a common pool of money. So the more money one company gets, the less there is left in the pool to be divided amongst the remaining artistes. It will probably be worth it for the record labels who have the listener base to make remastering their songs worth the time and money.

 

[MrRom92]

As someone who has more insight than most into what actually goes on at both major and independent labels, as well as the top studios on the planet… Spatial Audio is not a scam in the same way certain other audio technologies are (looking at you, MQA) but it may as well be when you consider the tricks and loopholes that are being taken advantage of to provide something that only technically qualifies as “spatial audio” on paper.


Almost no recordings are legitimately mixed for these new Spatial Audio formats. A very, very small minority in the grand scheme of what is actually advertised and on offer. And in the end, the vast majority of it is still only listened to by consumers on stereo equipment anyway, in the end achieving nothing that couldn’t also have been achieved *better* by a standard, competently made stereo mix.


This is by and large a return to the “duophonic” / “electronically reprocessed” fake stereo records that were pushed on us in the 60’s. Time is a flat circle.

 

[klasma]

I mean, just makes music people love to listen. Problem solved. 🤷🏻‍♂️

Well, the same applies to Spatial Audio. If Special Audio is so great and people thus listen to it more, it should pay for itself, shouldn’t it?

 

[laptech]

Indie labels have a right to be concerned because they know consumer choice will be the deciding factor in what music they purchase and listen to based on the musical quality of the song and the format it is in. At the moment it is a level playing field within itunes, songs are encoded the same and the format is the same, thus consumer deciding factor being the song, the type of song and the artist of the song but with spatial audio, that all changes because the audio quality of spatial audio coded songs will be much better that the current encoded songs. Spatial audio will change consumer choice from being the song and the artist that makes their purchasing decision to that of it being if the song is coded for spatial audio. Coded for spatial audio, the consumer wants because it is of a better quality and audio experience to that of regular songs. This would mean consumers therefore ignoring non-spatial audio songs for that of spatial ones.

The same principle applies to that of DVD's and Blu-ray. If a person has a blu-ray player and they are looking for movies to watch, they will naturally purchase the better quality blu-ray movie over that of a lower quality DVD movie. As a consumer, I do exactly that. due to me having a blu-ray player I completely ignore movies that are on DVD and just look at the blu-ray section meaning anything produced on DVD automatically gets missed/ignored because I am now only interested in the better quality produced blu-ray movies. Indie labels are worried the same will happen to them, consumers will ignore them and only go for songs produced in spatial audio.

 

[Timo_Existencia]

Well, the same applies to Spatial Audio. If Special Audio is so great and people thus listen to it more, it should pay for itself, shouldn’t it?

So you'd turn down the extra 10% Apple is offering you?

 

[klasma]

So you'd turn down the extra 10% Apple is offering you?

I’m saying that there should be no need for Apple to subsidize Spatial Audio if it is indeed a success with customers.

 

[Timo_Existencia]

This is by and large a return to the “duophonic” / “electronically reprocessed” fake stereo records that were pushed on us in the 60’s. Time is a flat circle.

That may very well be. But let' say we're back in the time when stereo recording became a thing. Apple, recognizing that it costs more, decides to give an incentive to speed adoption along.

I wouldn't see a problem with that then, and I don't see the problem now.

*and sure, some songs are stretching the definition; but we're in the middle of a time of transition.

 

[DarthDon]

I don't think this audio format will have much future. This reminds me of "Surround Sound" of the 80s... It's not bad that you can "turn" in the music - but it doesn't help much either.

 

[DarthDon]

As someone who has more insight than most into what actually goes on at both major and independent labels, as well as the top studios on the planet… Spatial Audio is not a scam in the same way certain other audio technologies are (looking at you, MQA) but it may as well be when you consider the tricks and loopholes that are being taken advantage of to provide something that only technically qualifies as “spatial audio” on paper.


Almost no recordings are legitimately mixed for these new Spatial Audio formats. A very, very small minority in the grand scheme of what is actually advertised and on offer. And in the end, the vast majority of it is still only listened to by consumers on stereo equipment anyway, in the end achieving nothing that couldn’t also have been achieved *better* by a standard, competently made stereo mix.


This is by and large a return to the “duophonic” / “electronically reprocessed” fake stereo records that were pushed on us in the 60’s. Time is a flat circle.

If you know your stuff... Does this have anything to do with dummy head recording?

 

[gsurf123]

I want music as the artist, producer and songwriter wanted it to be heard. The gimmickry is foolishness and tantatmount to taking a movie and editing it for 4:3 or cutting scenes. It is not the way it was meant to seen.

 

[jayducharme]

I mean, just makes music people love to listen. Problem solved. 🤷🏻‍♂️

Exactly. People aren't going to stop listening to Robert Johnson because he wasn't recorded in Spatial Audio.

 

[AdonisSMU]

Are people really complaining that better sounding music that requires additional work shouldnt be paid the 10% more for the extra time and effort? WTF?! It should be a chance for Indies to get paid more for doing additional work.

Ya’ll are worried about technology problems when its people problems we need to solve.

 

[Bob-K]

If customers had to pay 10 percent more to listen to Spatial Audio tracks, I suspect they wouldn't do it.

As a professional musician with experience in recording engineering, and as a music fan, I have zero interest in Spatial Audio, Dolby Atmos, other surround formats, and any resolutions above Red Book CD quality (44/16) for music listening. I consider them all gimmicks.

 

[Timo_Existencia]

Exactly. People aren't going to stop listening to Robert Johnson because he wasn't recorded in Spatial Audio.

Right? I mean, you won't get me to listen to Taylor Swift just because she's in spatial audio!*

*(I kid, I kid. sort of )

 

[Unregistered 4U]

Well, if MUSIC EXECUTIVES are saying it, MUST be true!

 

[Timo_Existencia]

If customers had to pay 10 percent more to listen to Spatial Audio tracks, I suspect they wouldn't do it.

As a professional musician with experience in recording engineering, and as a music fan, I have zero interest in Spatial Audio and Dolby Atmos.

Where did you fall on the digital/analog debate?

 

[AdonisSMU]

I believe they fear Apple promotion of Spatial Audio will put users to prefer to listen to that and since they can not afford to make their music SA they will get less royalties from less listening.

I mean, just makes music people love to listen. Problem solved. 🤷🏻‍♂️

I doubt it will even have an impact. People will listen to songs they like spacial or otherwise.