Apple, record labels negotiating last-minute streaming service terms days before expected WWDC launc

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  • Reply 21 of 43
    cnocbuicnocbui Posts: 3,613member
    Quote:


     It was previously reported that Apple was driving hard bargains with record labels and content owners in hopes of offering consumers a cheaper alternative, but today's report suggests those talks were fruitless.


     

    How much did Apple pay for Lovine and Dre's contacts and abilities to negotiate, again?

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  • Reply 22 of 43
    tmaytmay Posts: 6,468member
    Quote:
    Originally Posted by Gatorguy View Post





    I think the same $10/mo, but they also have a free trial period (60 days maybe?) just as Apple is rumored to include. You're probably right about the time-restricted exclusives since they already do that with iTunes. No reason for the subscription service to be any different is there?

    I don't think the basics are different. But from a company culture standpoint, music is a Steve Jobs legacy, and Apple treats it very seriously. So much so that the FTC is concerned that Apple carries too much weight and many advantages in online music distribution that are barriers to entry for competition. It isn't monopoly behavior, per se, but a culture that overshadows all others, and is perceived and acknowledged by musicians, industry, and listeners as the premier player.

     

    Apple is the Superpower in music.

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  • Reply 23 of 43
    gatorguygatorguy Posts: 24,740member
    tmay wrote: »
    I don't think the basics are different. But from a company culture standpoint, music is a Steve Jobs legacy, and Apple treats it very seriously. So much so that the FTC is concerned that Apple carries too much weight and many advantages in online music distribution that are barriers to entry for competition.
    :D
    I don't think that was the rumored reason for the FTC and EU competition authorities looking into it. I t was just a tad more than that, and I'm not saying an investigation is validation either. But I get the point you wish to make.
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  • Reply 24 of 43
    cnocbuicnocbui Posts: 3,613member
    Quote:

    Originally Posted by cali View Post





    *Beats made 1.5B in 2013.

    That was earnings.  I bet their profit was somewhat less.

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  • Reply 25 of 43
    tmaytmay Posts: 6,468member
    Quote:
    Originally Posted by Gatorguy View Post





    image

    I don't think that was the rumored reason for the FTC and EU competition authorities looking into it. I t was just a tad more than that, and I'm not saying an investigation is validation either. But I get the point you wish to make.

    Apple has pushed the meme that free should die, but I don't see anything wrong with that. It is the labels that have control over that, and they agree with Apple. The FTC an EU would be out of line to punish Apple for stating the obvious.

     

    Google and Amazon are working together to cut prices for streaming by reducing the cut to the labels and musicians. 

     

    added link

     

    http://www.musicbusinessworldwide.com/google-amazon-and-pandora-join-forces-to-fight-music-industry-over-royalty-rates/

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  • Reply 26 of 43
    penchantedpenchanted Posts: 1,070member
    Quote:

    Originally Posted by tmay View Post

     

    Apple has pushed the meme that free should die, but I don't see anything wrong with that. It is the labels that have control over that, and they agree with Apple. The FTC an EU would be out of line to punish Apple for stating the obvious.

     

    Google and Amazon are working together to cut prices for streaming by reducing the cut to the labels and musicians. 


    And for this reason alone the labels should be anxious to do a deal with Apple.

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  • Reply 27 of 43
    gatorguygatorguy Posts: 24,740member
    tmay wrote: »
    Apple has pushed the meme that free should die, but I don't see anything wrong with that. It is the labels that have control over that, and they agree with Apple. The FTC an EU would be out of line to punish Apple for stating the obvious.

    Google and Amazon are working together to cut prices for streaming by reducing the cut to the labels and musicians. 
    They are? I'd not seen that tho it wouldn't be any surprise. The only thing I've seen rumors of is Apple trying to do so, hoping they could get the subscription down to as little as $6 or so by cutting what the musicians and labels would get.

    EDIT: The AI article alludes to the pressure Apple is putting on the labels/performers/writers to accept lower royalties. " It was previously reported that Apple was driving hard bargains with record labels and content owners in hopes of offering consumers a cheaper alternative..."

    As the big dog maybe Apple can get them to do so too, sharing less with them percentage-wise than the smaller Google or Amazon was able to wrangle.
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  • Reply 28 of 43
    tmaytmay Posts: 6,468member
    Quote:

    Originally Posted by Gatorguy View Post





    They are? I'd not seen that tho it wouldn't be any surprise. The only thing I've seen rumors of is Apple trying to do so, hoping they could get the subscription down to as little as $6 or so by cutting what the musicians and labels would get.



    EDIT: The AI article alludes to the pressure Apple is putting on the labels/performers/writers to accept lower royalties. " It was previously reported that Apple was driving hard bargains with record labels and content owners in hopes of offering consumers a cheaper alternative..."



    As the big dog maybe Apple can get them to do so too, sharing less with them percentage-wise than the smaller Google or Amazon was able to wrangle.

    I added the link; but I'll post it here.

     

    http://www.musicbusinessworldwide.com/google-amazon-and-pandora-join-forces-to-fight-music-industry-over-royalty-rates/

     

    I should have stated that this was specifically wrt streaming radio, i.e., Panora, and similar services.

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  • Reply 29 of 43
    linkmanlinkman Posts: 1,068member
    Quote:

    Originally Posted by ksec View Post

    I hope Apple wont do a one price fit all system.

    As far as streaming music goes, I can't imagine them doing it any other way. What sort of options/tiers can they put in with streaming music anyway? [disclaimer: I'm not all that imaginative with marketing]

     

    1. Ads vs. no ads (why pay for ads? -- seems to work for ESPN though)

    2. Radio style vs. playlist (choose the channel vs. choose the songs)

    3. For radio style limited/no skipping vs. unlimited skipping

    4. Expanded catalogue for higher priced tiers -- can't fathom them doing this

    5. Higher bit rate for more expensive tiers

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  • Reply 30 of 43
    gatorguygatorguy Posts: 24,740member
    tmay wrote: »
    I added the link; but I'll post it here.

    http://www.musicbusinessworldwide.com/google-amazon-and-pandora-join-forces-to-fight-music-industry-over-royalty-rates/

    I should have stated that this was specifically wrt streaming radio, i.e., Panora, and similar services.
    Thanks for the link. So they're doing the same as Apple then?
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  • Reply 31 of 43
    tmaytmay Posts: 6,468member
    Quote:
    Originally Posted by Gatorguy View Post





    They are? I'd not seen that tho it wouldn't be any surprise. The only thing I've seen rumors of is Apple trying to do so, hoping they could get the subscription down to as little as $6 or so by cutting what the musicians and labels would get.



    EDIT: The AI article alludes to the pressure Apple is putting on the labels/performers/writers to accept lower royalties. " It was previously reported that Apple was driving hard bargains with record labels and content owners in hopes of offering consumers a cheaper alternative..."



    As the big dog maybe Apple can get them to do so too, sharing less with them percentage-wise than the smaller Google or Amazon was able to wrangle.

    Apple negotiates only with the labels, and the rumor I heard is that they wanted a $7.99 a month service.

     

    Your concern is noted for the writers and performers, but in fact, any negotiation with the labels will impact what they make. This applies to Google and Amazon as well. Unfortunately for the artists, neither Google nor Amazon is anywhere close to generating the revenues for them that Apple does.

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  • Reply 32 of 43
    leavingthebiggleavingthebigg Posts: 1,291member
    gatorguy wrote: »
    FWIW I think you can download playlists to over your smartphone over wifi on Google Music to avoid streaming costs. Download now, listen later.

    What confuses me is how GOOG was able to get the licenses in place a year ago (and in dozens of countries) but Apple is having trouble doing so. They are both subscription and they'll be in the same price range too if the Apple rumored price is correct.. Anyone got an idea why the negotiations are a problem? Is Apple low-balling the content owners? Is it something else? Maybe there's no problem anyway and this is just a bogus rumor.

    This sounds like the time the record labels authorized Amazon to go DRM-free while withholding the authorization from Apple.

    On the Google front, for some reason my memory has focused on ad-sharing revenue being apart of the Google deal.
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  • Reply 33 of 43
    tmaytmay Posts: 6,468member
    Quote:

    Originally Posted by Gatorguy View Post





    Thanks for the link. So they're doing the same as Apple then?

    It was noted that Apple was specifically not part of that group, so no, not close to the same. That group, MIC, is attempting to change the royalty rates for musicians. MusicFirst, which is the artists, is fighting the MIC group which includes Google and Amazon.

     

    This is not in anyway the same situation as negotiations with the labels for streaming rights or music download rights. In that, Google and Amazon will be in exactly the same situation as Apple.

     

    If anything, MIC is a much more egregious play against musicians.

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  • Reply 34 of 43
    gatorguygatorguy Posts: 24,740member
    This sounds like the time the record labels authorized Amazon to go DRM-free while withholding the authorization from Apple.

    On the Google front, for some reason my memory has focused on ad-sharing revenue being apart of the Google deal.
    Google Music is ad-free.
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  • Reply 35 of 43
    gatorguygatorguy Posts: 24,740member
    tmay wrote: »
    It was noted that Apple was specifically not part of that group, so no, not close to the same. That group, MIC, is attempting to change the royalty rates for musicians. MusicFirst, which is the artists, is fighting the MIC group which includes Google and Amazon.

    <span style="line-height:1.4em;">This is not in anyway the same situation as negotiations with the labels for streaming rights or music download rights. In that, Google and Amazon will be in exactly the same situation as Apple.</span>


    <span style="line-height:1.4em;">If anything, MIC is a much more egregious play against musicians.</span>
    HUH? Did you read it?
    "... mission to drive down the royalties it pays artists/labels and songwriters/publishers" How is that different again?

    You mentioned musicians. What they want is "the establishment of a sound recording royalty for AM/FM radio, removing satellite radio’s below-market-rate exemption, and treating pre-1972 recordings with the same level of respect as those made after February of 1972". That would have very little to do with anything Google offers outside potentially the pre-72 recordings. It's not Google Music.
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  • Reply 36 of 43
    tmaytmay Posts: 6,468member
    Quote:
    Originally Posted by Gatorguy View Post





    HUH? Did you read it?

    "... mission to drive down the royalties it pays artists/labels and songwriters/publishers" How is that different again?

    This is for digital performance royalties, the equivalent of per song royalties that terrestrial radio pays, and only songwriters and publishers, not the performers, are compensated.

     

    Pandora’s mission to drive down the royalties it pays artists/labels and songwriters/publishers just got some heavy back-up – in the shape of Google and Amazon.

    The duo have joined the likes of Pandora, IHeartMedia, NPR, and the National Restaurant Association as members of new lobbying group ‘The MIC (Music, Innovators, Consumers) Coalition’.

    These companies know that these are crucial times for the future of royalty payments in the US, the world’s largest recorded music territory:


     

    • The Department of Justice is currently reviewing the statutory rates that publishers can charge for digital performance royalties. The publishers are lobbying for the ability to pull their digital negotiation rights out of ASCAP and BMI – which would mean a change in the country’s Consent Decrees. This would allow them to put direct commercial pressure on the likes of Pandora for higher rates;

    • Meanwhile, the Copyright Review Board is mulling revisions to the statutory royalty rate paid to labels and artists through SoundExchange. Pandora wants to push its per-stream payout down, while SoundExchange is lobbying to double it to around $0.0025 per play;

    • Finally, recent recommendations from the US Copyright Office, now being considered by Congress, included a call for artists to receive a performance payment from US terrestrial radio for the first time. Currently, only songwriters/publishers are paid when a song is played on US radio; a situation challenged by the Fair Play, Fair Pay act.

     

    In no way is this the equivalent of music streaming services that Apple is negotiating licenses; though it likely covers iTunes Radio. While Apple and Spotify are not involved with MIC, they might be beneficiaries of lower royalties. 

     

    You appear to be totally unable to comprehend the differences between internet radio and streaming from a rights standpoint.

     

    Here's a hint.

     

    Internet radio gives you channel selections, but they select the music. 

    Music streaming; you choose what you want to play and when.

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  • Reply 37 of 43
    gatorguygatorguy Posts: 24,740member
    tmay wrote: »
    You appear to be totally unable to comprehend the differences between internet radio and streaming from a rights standpoint.
    Hardly since I pointed out that it's a market Google Music doesn't cover. Google Music doesn't have free internet radio either altho iTunes Radio might fall in that category.
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  • Reply 38 of 43
    tmaytmay Posts: 6,468member
    Quote:

    Originally Posted by Gatorguy View Post





    Hardly since I pointed out that it's a market Google Music doesn't cover. Google Music doesn't have free internet radio either altho iTunes Radio might fall in that category.

    So why is Google even involved? Are they hedging their bets on some future internet radio?

     

    At any rate, Apple isn't part of that.

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  • Reply 39 of 43
    gatorguygatorguy Posts: 24,740member
    tmay wrote: »
    So why is Google even involved? Are they hedging their bets on some future internet radio?

    At any rate, Apple isn't part of that.
    If you read the article you would know why they would take an interest in it. Little doubt Apple has an interest too but apparently they would rather someone else do the work.
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  • Reply 40 of 43
    tmaytmay Posts: 6,468member
    Quote:
    Originally Posted by Gatorguy View Post





    If you read the article you would know why they would take an interest in it. Little doubt Apple has an interest too but apparently they would rather someone else do the work.

    I stated that Apple might benefit, and neither of us know of Apple's position on this, but as you say Google and Amazon, et al are doing the dirty work.

     

    Publicly doing the dirty work I might add. But nice attempt at trying to drag Apple through the mud. 

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