If you’re a music lover, creator, and/or nerd like me, you’re probably hearing a lot of mixed and somewhat befuddled reviews of Apple’s new aggregated music service, Apple Music, announced at their WWDC keynote on Monday. It was exciting to watch unfold — Apple had revolutionized the business once, and we hoped, in this era of great uncertainty, that they could be the hero we need, one more time. But, as minutes passed, speakers including Jimmy Iovine, Drake, and Trent Reznor (via promo video) presented a lot of ideas, but raised many more questions than they answered. How are artists being compensated in this new arrangement? What’s happening to the old digital download? What sort of information do artists get from their listeners and how can they use it? These questions will likely have to wait until the official release on June 30th, but two things about the launch seem immediately clear. Apple Music empowers artists with tools to connect more directly with their fans than ever before, while killing the most significant source of sales revenue available to artists digitally.
Streaming is the way not of the future, but of the now, and Apple is trying to make the most of it.
With the launch of the new subscription-based, all-in-one service, it appears Apple is caving in its landmark download model, the iTunes Store. This seems, on a surface level to be a counterintuitive move — gouging out a flagship product that has defined the industry for 15 years — but when it comes to change and innovation, Apple is champion. The writing is pretty openly on the wall for the way recorded music is sold today, and digital downloads just don’t sell the way they used to. Streaming is the way not of the future, but of the now, and Apple is trying to make the most of it.
And Apple is trying to make the most of ALL of it, taking on competitors across the music industry. In their own words, Apple Music is “all of the ways you love music. All in one place.” The most blatant challenge is to streaming providers like Spotify. But that’s not the only business they’re after. Beats 1, their radio offering, not only boasts as an alternative to repetitive, confining commercial radio, but as something you can take with you anywhere and everywhere, and so provides an answer to broadcast, internet, and satellite radio, including Sirius XM and Pandora. With Connect, they’re offering an alternative to the highly popular streaming, sharing, and social site, SoundCloud, but with many added features. Up until now, these new-music sources defined what was commercially viable and appealing, and Apple isn’t just trying to overtake these outlets of commercial appeal. No, in true Apple form, it is an attempt to redefine what that commercial appeal even is.
As a subscription service, Apple Music provides listeners almost no incentive to buy an album.
Apple Music’s Connect feature is, to me, the most promising and innovative tool for creators of music taking their process to the masses. Artists can offer exclusive content, works in progress, videos and photos, lyrics, and unique behind-the-scenes looks at what they’re working on. There appears to be a lot of flexibility with this part of the service and many ways for fans to directly engage with the artists in a way that no other service offers. (Though technically, MySpace is still out there…) Still, from a purely promotional standpoint, Connect is good news for emerging artists, as “Apple music provides all artists, even the kids in their bedrooms, a way to engage with their audience.”
Unfortunately for those kids, engagement alone does not equal revenue, and Apple plans on keeping a fairly high portion of that revenue, despite the fact that the new service is unlikely to raise their 2016 bottom line by even one percent. When a listener purchases an album in the iTunes store, Apple takes roughly a 30% cut and pays the artist out the other 70% (generally around $5-8 per album). As a subscription service, Apple Music provides listeners almost no incentive to buy a song or album. And what’s more, early reports claim Apple could pay nothing at all to independent artists for the first three months of the service’s free trial period*. Beyond which, streaming revenues are infinitesimally small — Spotify averages $.005 per play. Drawing listener focus away from the iTunes store will almost certainly carve into an artist’s sales.
(Ed. note: If you want to know more about how other streaming services pay out to artists, and what you can do to help support your favorite acts, read our article on how to listen to music in a way that supports musicians!)
I can’t shake the feeling that this is not the overhaul and the long-term answer to supporting musicians and their careers we’d hoped for, but just another bandage on an industry model that will continue bleeding to death. If Apple already knows what that long-game answer is, they’re in no rush to implement it. However, it seems more likely they aren’t even thinking about it. Yes, streaming is the current “long-tail solution” to the loss of digital record sales as a major source of income, and “should” pay out more extensively and to a broader selection of artists over time. But until the music industry finds or invests in alternative means of commodifying recorded music, we’re going to see fewer and fewer innovative new artists because they won’t be able to afford to wait for that support. Meet the new boss, worse than the old boss.
This is not the long-term answer to supporting musicians we’d hoped for, but just another bandage on an industry model that will continue bleeding to death.
I have a hard time believing that curated playlists, real-life DJs programming radio material, and “less-algorithmic” suggestions will curb the same kind of problematic conflict-of-interest, backroom payola that has plagued the industry all along — even more so knowing Apple wants to centralize the entire industry under their singular, definitive service. There is, however, a potentially positive side effect to this apparent future: the rise of the niche market of music fans who directly support the artists they love. This could mean that, rather than a fan subscribing to access 30+ million tracks and paying an infinitesimal fee to all of them (proportional to their popularity in plays), that they could be paying those same dollars, or many more dollars, directly in support of the artists they love.
While Apple does its best to push device sales through the emotional pull of music by undercutting artist revenue and using their art as a loss-leader, hopefully the greater reaction from the musical community is to reject this “business model” and innovate new modes of directly supporting the music and musical experiences we know and love.
*Update: An earlier version of this article quoted a published percentage split between Apple and the content rights holder that has since been called into question. We will continue to update this article as more information is released.