Apple Likely Won’t Pay Full Royalties During Trial Period of Apple Music

Just in case you thought Apple Music was all set to go, here is another thing the Wall Street Journal has thrown in. Although it has made a U-turn and announced that it will pay artists during the free, three-month trial period, Apple has yet to announce (or inform music right owners) how much it will pay during that period.


So, what some are calling “theater” or a PR stunt, has a lot of open questions, and just how much Apple is willing to pay each time a person listens to a song is the hardest to answer.

Apple declined to say how much it plans to pay during the trial period, though it said the rate will increase once customers start paying for subscriptions. In the first three months of the service’s life there will be no subscriber royalty rate on which to base the rates. The company could find other ways to calculate a rate and is expected to share its plans with music companies soon.

Apple risks raising the ire of Ms. Swift and others if it comes in with what would appear to be a lowball offer.

The Wall Street Journal points to the numbers released by Spotify: Last December, on the service’s subscription tier, that amounted to 0.68 of a cent per listen in the US.

As for the free tier, you may recall that Apple lobbied the music industry against it, and in December that amounted to 0.14 of a cent per listen in the US.

Keeping those numbers in mind, such royalties could add tens of millions to the initial cost of launching Apple Music. Not that this would be a problem for Apple, as it is currently sitting on a $193 billion cash pile, according to the latest quarterly earnings report.