Apple Wants to Bring Down the Price of Streaming. Artists Are Freaking.

Yeah, there’s iTunes Radio, but it’s nowhere near what Apple needs to compete with Rdio and Spotify. But now that they own Beats (along with a few other related acquisitions), they’re getting ready to launch…something to compete in the arena.  Even with all the money on the planet, they’re going to have to do something more than just buy their way into the space.  Yeah, they’ve got the hardware and the credit card database (500 million+) but what else will they have to do?

How about compete on price?

While the standard monthly fee for a subscription to Rdio, Spotify and others is $9.99, Apple is rumoured to be talking about bringing the price down to $7.99. That’s great for consumers but artists are understandably concerned. They’re already complaining about the low payouts they’re getting from streaming services.  Let’s go deeper with the Internationa Business Times.

Apple’s forthcoming subscription music service has been described as a Spotify-killing game changer. But for artists, a larger question looms: What happens when the world’s largest seller of digital music begins to push streams rather than sales to its millions of customers? Can artists survive on a stream made up of fractions of pennies? And, if Apple stops selling songs, will artists have any other choice?

“This is the issue that’s constantly getting swept under the rug by streaming services,” Marc Ribot, the co-founder of the Content Creators Coalition, said. “Spotify’s rates are not sustainable for the vast number of working artists.”

When rumored details about Apple’s imminent subscription service began to circulate Wednesday, coverage focused principally on two things:

  1. the service’s integration with both Apple and Android devices; and
  2. its $7.99 per month price.

That price point has not yet been confirmed. “It is not a done deal,” said Tom Silverman, the founder of Tommy Boy Records, who serves on the board of Merlin, a nonprofit negotiating body that represents the music industry’s independent labels. But whatever the rate winds up being, its funds will still be funneled into an agreement designed to principally benefit the major labels rather than the artists.

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Alan Cross

is an internationally known broadcaster, interviewer, writer, consultant, blogger and speaker. In his 30+ years in the music business, Alan has interviewed the biggest names in rock, from David Bowie and U2 to Pearl Jam and the Foo Fighters. He’s also known as a musicologist and documentarian through programs like The Ongoing History of New Music.

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