Apple's iTunes Radio Terms With Record Labels Revealed

iPadPublisher

macrumors 6502
Apr 14, 2010
469
59
Are you kidding? The customer pays the whole thing up front. It is buried in the cost of the iPhone. You don't get this for free.
Ad revenue, and increased iTunes sales will cover 90-110% of its operating costs, making it a slight loss-leader or slightly profitable, depending on which way the wind blows, but there will be no incremental cost to the hardware. Other way around, for Apple, this is just meant to make the hardware and Apple's overall ecosystem more appealing and to drive hardware sales.
 

iPadPublisher

macrumors 6502
Apr 14, 2010
469
59
Anyone care to explain how the music industry works these days? How do small independent artists get on itunes or pandora? Surely they're not associated with a major music label, right? And what do major music labels do for artists, why would they want one?
There are digital distributors, or "aggregators" as they're called, with which smaller artists or labels can send their music through to iTunes, Amazon MP3, Rhapsody, etc. Some of them charge a flat up-front fee to deliver, some take 20% of sales, some charge a hybrid of those two. The Orchard (www.theorchard.com) is the largest of them now, having gobbled up two competing aggregators in the past two years. They alone represent some 2-3 million independent tracks for sale.

There are trade-offs to signing with small label vs. going it on your own, or holding out for a major label. Each is a totally different pathway and experience, these days. Major labels have more swing for radio, and sometimes spend tens of thousands recording and promoting a new artist. There isn't an indie on the planet that can afford that -- but major labels also shelve new artists, basically hitting a contractual "pause button" on their careers making them ride out their whole contract term, essentially doing nothing. This happens a lot. Some small indies still give a crap, and work hard for their artists. They don't always get major label type shine, but it can be a slow and steady build towards more recognition, distribution, and a larger fanbase. Some small labels specialize as "springboard" labels, essentially getting an artist from Point A to Point B (or C) in their career... a springboard towards bigger and better things, if the artist can parlay what they get into more.

Going it alone has major advantages such as 100% creative control, ability to collect a larger percentage of revenues and maintaining ownership and/or control of copyrights to the music -- but your budget is exactly how much you want it to be, and comes out of your own pocket. Some artists can take a small nugget, and slowly grow it into something bigger and better, and make a decent living on their own, with no need for a label. Macklemore is a good example of a completely independent artist who managed to blow the **** up somehow, but that's an extremely rare case.

Things like Pandora Radio, iTunes Radio, Shazam, Rhapsody... any chance that people may have to stumble on their music accidentally, is a good thing. A good distributor or aggregator will make sure you get on as many outlets as possible, and will try to gain editorial coverage whenever possible, which is also rare.

Lots of options and decisions to make.
 

gnasher729

macrumors P6
Nov 25, 2005
16,509
3,102
Anyone care to explain how the music industry works these days? How do small independent artists get on itunes or pandora? Surely they're not associated with a major music label, right? And what do major music labels do for artists, why would they want one?
Many years ago when the iTunes Store started, Apple negotiated contracts with the four major labels. Identical contracts. They then offered the exact same contract to every label, no matter how large or small. They accept the contract or not, no negotiations. On the other hand, it's the contract that the best lawyers and negotiators of the four big labels agreed to, so they should be fine.
 

gnasher729

macrumors P6
Nov 25, 2005
16,509
3,102
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.
Any new iPhone bought because of this feature pays for about 100,000 songs played.
 

runeapple

macrumors 6502a
Mar 5, 2010
651
96
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.
If you get bored of songs as easily as I do and constantly want new songs, that makes buying music unrelistic in terms of cost and in terms of storage, my iPhone only has 64GB! 17GB is already filled with Photos.

I am happy to pay for a music streaming service (just like a pay for netflix for my movies) - but local storage is become a thing of the past.
 

daio

macrumors regular
Apr 14, 2011
153
34
Germany
iTunes radio in Germany? Unlikely I'd say

Ah iTunes Radio, I can only dream of that!

Here in Germany we don't even have music on YouTube, it's blocked by GeMa, the German Music Association, so the idea that one day we will get the chance to stream music "for free" on iTunes Radio without GeMa taking their share seems very unlikely.

Fingers crossed that Apple and GeMa will strike a deal enabling consumers to enjoy the music that people in other parts of the world can.

As an aside, we still don't even have Google street view working across the majority of the country thanks to privacy concerns and youtube clips with music in the background are either banned, show the GeMa logo and nothing more or have their soundtracks completely replaced by something ludicrous. Google must hate the German authorities! Pandora is also blocked here although Spotify seems to be allowed in! :eek:
 

NoneOfYourB

macrumors member
Jan 23, 2013
59
4
To me, this screams that the system is broken. There is too much management between the music and the listeners. Too many people with their hands out, doing nothing but pushing paper across a desk.
Doing nothing?
Who's going to book the venues, make hotel reservations - world wide?
Who's going to haul around the equipment, drive the trucks?
Who's going to negotiate, look after the money?
Remember if you fail, you can lose millions of dollars.

Maybe Lars Ulrich does it in his spare time...
 

alent1234

macrumors 603
Jun 19, 2009
5,654
122
Anyone care to explain how the music industry works these days? How do small independent artists get on itunes or pandora? Surely they're not associated with a major music label, right? And what do major music labels do for artists, why would they want one?

they give them money to record their music in a professional studio and advertise it. they plant stories on the internet about how this new cool band is breaking out, etc. and they book them on opening gigs with the label's other bands

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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.
OMG, its like me having to wake up to go to work everyday. terrible

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To me, this screams that the system is broken. There is too much management between the music and the listeners. Too many people with their hands out, doing nothing but pushing paper across a desk.

I'm not about stealing music, but if there were a better agency for bands to use to get promoted-- Apple would be a good start with iTunes, Radio. Maybe even working with ClearChannel directly (although I have no idea what CC really does, just know they own radio stations, billboards).

Uhg... just makes me sad.

not like bands just show up at some venue and play a show. a lot of people have to do a lot of work months in advance to make a tour happen
 

mdelvecchio

macrumors 68040
Sep 3, 2010
3,112
1,014
Still don't see a point in Apple duplicating what Pandora already does so well.
simple: by integrating it into the OS apple can make it more effective at selling iTunes content than Pandora could be.

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Why not just pay for your music. Everytime someone plays a song on these phony radio/spotify services, the artist makes about a cent.
the two models aren't mutually exclusive. I pay my music, but I use a service like this (Pandora) to discover new music I'm likely interested in.
 

attila

macrumors 6502a
It's bloody ridiculous that anyone would have to pay anything to SKIP something the user doesn't want!

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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.
I'm paying $4/month for Last.fm - can't get any better radio than that!

User generated tagging of music ensures better results when you choose to listen to 'similar artists'.
 

inlinevolvo

macrumors 6502
Jul 11, 2012
359
3
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.
Just because the market has shifted and the industry hasn't, it isn't suddenly the consumers fault. The record labels are a dead weight. They are still living in the $15.99 CD days. Time to restructure.
 

Bremel

macrumors newbie
Jun 11, 2012
12
0
Belgium
But what's the deal with it only being available in the United States? This stupidity have to stop, there is no reason why customers outside the United States shouldn't be able to use all services like iTunes Radio, iTunes Match and not have all the content available through the iTunes Store.

I know this has something to do with all the goddamn stingy content providers and their filthy business about making various rules for different regions and whatnot, but please for the love of God fix this nonsense once and for all so we don't have to bother with this kind of feature fragmentation and frustration any longer.
Agreed!

We already pay more for our apple products and get less in return.
Apple TV, Siri, iTunes Radio, ...
 

MacDav

macrumors 65816
Mar 24, 2004
1,012
0
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.
If the artist writes his/her own stuff and self publishes, they get all of that 14 cents. If they get a million listens they make...$140,000 for one song. Even 1 cent times a million is $10,000. Every penny counts. ;)
 

ValSalva

macrumors 68040
Jun 26, 2009
3,741
195
Burpelson AFB
Agreed!

We already pay more for our apple products and get less in return.
Apple TV, Siri, iTunes Radio, ...
I'm sure Apple would love to roll out iRadio everywhere. Apple has everything to gain by making iRadio international. It's the content copyright holders that are the rate limiting step.
 

Risco

macrumors 68000
Jul 22, 2010
1,752
150
United Kingdom
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?
Brand awareness, exposure, catalogue size and response, something Apple can offer in bucketloads. This in turn will generate far greater revenue than anything all of the current competitors can offer.