July 2015

Is Apple Rotten To The Core With Their Streaming Music Service?
Would you work for three months without getting paid?
Article By Steven R. Rochlin

  Would you work for someone for three months without pay? Of course you wouldn't and this is what the upcoming Apple Music wants to do. Even with many, many billions in cash on hand, Apple is not going to be paying anyone for the music they will be streaming online during the first three month trial period. Why major, and minor, record labels would agree to this is something questionable at best. In fact many of the smaller labels are not all that happy about this situation at all. According to an article within the Music Business, it says:

"Last week saw uproar across the independent music community after details of a prospective Apple Music contract leaked – asking the indies to accept zero royalty payments for the service's three-month free trial." Please read the full article at this link. Within another article on the site it says "Following castigation from US and Canadian independent label groups, now UK and Australian bodies have added their voice to the backlash." A letter written by the Association of Independent Music's (AIM) Alison Wenham said that "despite what Jimmy Iovine might claim independent labels had suffered from a lack of consultation from Apple over its launch." Apple has massive funding and we are are at a loss why they expect musicians, music writers, lyricists, engineers, etc to work for free without any compensation. Here is Alison's letter below in full:

Dear Members,

Having now had over a week to reflect on the launch of Apple Music we are not satisfied that the deal being offered under this new initiative is fair or equitable to independent music companies. Clearly there is great potential for this new service and the global reach that Apple can offer should, in time, help further develop existing streaming markets and open up new ones around the world. It could be a game-changing moment for the industry. However, the speed at which Apple has introduced their plans and its lack of consultation with the independent music sector over deal terms (despite what Jimmy Iovine might claim) has left us with the uneasy feeling that independents are being railroaded into an agreement that could have serious short-term consequences for our members' interests. The main sticking point is Apple's decision to allow a royalty free, 3-month trial period to all new subscribers. This means that no royalties will be paid through to rights holders during that 3-month period. This is a major problem for any label that relies on new releases rather than deep catalogue as the potential for this free trial to cannibalize not only download sales, which remain a very important revenue stream, but also streaming income from other services, is enormous.

As a whole the independent sector is a powerful voice in the music industry but its individual parts , the smaller labels particularly, cannot withstand such a potentially catastrophic drop in revenue. Essentially Apple is asking the independent music sector to hedge its risk, to fund their customer acquisition program and to shoulder the financial burden for their global launch. Apple has always been a valued partner to the music industry but this decision to withhold income from the independent music sector is against the spirit of collaboration that we have come to expect from them. Each individual member of AIM must, of course, make their own decision whether or not to sign this agreement, but many members have already expressed very real concerns about the consequences of doing so, hence our communication to the whole membership.

It is AIM's view therefore that, in its present form, this agreement sadly does not meet a standard of commercial fairness that we can endorse.

Regards,

Alison Wenham

Within an open letter to Apple, the German Association of Independent Music Companies' Secretary General Jörg Heidemann has said, "...Your plan not to compensate independent labels during the three-month trial period leads to the assumption that you don't respect the music of independent artists or the work their partners do. It is obvious that this will reduce the overall income for independent artists and labels significantly at a time when many depend on every cent for survival. Your company is not a start-up, your company is the "first U.S. company to cross the $700 billion valuation mark" and the biggest digital music retailer, so we'd assume you're definitively able to pay the independents and their artists. Your company wants to use the content independent artists and their partners created, which took hard work, money and time. My guess is that without this music Apple Music won't be that interesting, actually it might be quite boring with just mainstream acts on board." You can read the open letter at this link. Yes my friends, Apple has massive cash available, as in true liquidity and not valuation just on paper in assets. Please keep in mind a single billion is 1000 million, and so please allow me to type this out for you. $700 billion is $700,000,000,000, yet Apple can't find a few million dollars to pay musicians for their hard work as Apple is promoting their own company for their own benefit? i wonder if Spotify, Pandora, TIDAL, Deezer and others can stream music completely free of charge for three months to promote their company? Oh, wait, they can't yet Apple can. Um, hello to United Sates of America, European, Canadian, Asian and other regulators. This includes you RIAA and IFPI to name a few as well. Is this microphone on? Can you hear me?

Musical artist Brian Jonestown Massacre says that "Apple Music (is using) bullying tactics for not complying with royalty-free policy (as posted here). "It's not ok for these fucking idiots to decide art has no value." The Fact Magazine article continues by saying, "On Twitter today, Newcombe said after being contacted about the non-royalty policy he asked what would happen if he declined and according to him, Apple threatened to remove all of his band's music from iTunes. Newcombe put out several furious tweets, calling Apple "a satanic corporation". It may be time for lawyers to get involved as it has been said this tactic by Apple might not be legal. Also, i have heard that if journalists say less than nice things about Apple products they may banned from advanced access for reviewing future Apple items. If this is true, it makes us wonder when, not if, there will be legal repercussions. Then again with Apple being a huge part of Wall Street, hedge funds, retirement funds, etc, if their stock tanks it would cause an immense negative ripple effect (did someone just whisper Too Big To Fail, Thus No One Goes To Jail?).

Newcombe is not the first artist to be critical of Apple. A wide variety of others are also less than enthusiastic about Apple's free three month of non-payment to musicians. Beggars Group, the company behind many popular labels including 4AD, XL, Matador and Rough Trade, released a statement expressing their fears about the effect it could have on artists and independent labels. The Rolling Stone magazine featured some of these comments here. Bon Iver's Justin Vernon spoke very critically about the company and has an article on why Apple Music is "proof that the company has stopped innovating". You can read more comments by Anton Newcombe at this link.

So before you take Apple Music up on their free three month trial, remember that you are basically hiring musicians, artists, lyricists, songwriters, sound engineers, etc without them receiving any pay. Perhaps it is time to send Apple a message and complain on their discussion boards, post your comments on your social media sites, etc. If there is enough pressure, perhaps Apple can spare a few million from the hundreds of billions to properly pay those who are providing them content in hopes their company benefits. Am sure Apple would never ask their coders, those at Foxconn Technology Group in China who build Apple device, etc to work for free for three months. At least, perhaps, if doing so was not blatantly illegal in many parts of the world (including China). Would you work for three months free of charge to benefit someone else?

Of course we should be asking ourselves why Apple does not hire American workers to build their products, yet perhaps that is another can of worms inside the rotten Apple core as we have all read about Foxconn working conditions and suicides by workers due to high stress on the job. Am sure major recording labels had to sign off on this free three month deal, so we ask why would a musical artists, lyricist, recording engineer, etc want to be part of a company that would agree to such terms. Furthermore,  will music executives and staff at the major recording labels agree to working free of cost for three months? So which major recording label will be first to announce that their entire staff fro CEO to the janitors are willing to work for free for three months. This also includes the RIAA and IFPI. There is no doubt that there needs to be some major changes in how music is distributed and sold, yet cheating musicians for being paid for their work is adding insult to the low pay of streaming music injury.

Have never said this within an article, yet please share this article with everyone you can. We need to apply pressure to Apple and the major recording labels as musicians deserve to be properly paid for their work. If we allow companies to get away with this now, who knows what they may do in the future.

Update: According to this link, it says "Despite reports to the contrary, an Apple representative tells Rolling Stone that the company is not threatening to remove music from its iTunes Store by artists who do not sign up for its new streaming service Apple Music. "It will not be taken off," a spokesperson for the company says."

Update 2 (06/21/15): None other than pop superstar Taylor Swift has chimed in on this matter and says:

"To Apple, Love Taylor

I write this to explain why I’ll be holding back my album, 1989, from the new streaming service, Apple Music. I feel this deserves an explanation because Apple has been and will continue to be one of my best partners in selling music and creating ways for me to connect with my fans. I respect the company and the truly ingenious minds that have created a legacy based on innovation and pushing the right boundaries. 

I’m sure you are aware that Apple Music will be offering a free 3 month trial to anyone who signs up for the service. I’m not sure you know that Apple Music will not be paying writers, producers, or artists for those three months. I find it to be shocking, disappointing, and completely unlike this historically progressive and generous company. 

This is not about me. Thankfully I am on my fifth album and can support myself, my band, crew, and entire management team by playing live shows. This is about the new artist or band that has just released their first single and will not be paid for its success. This is about the young songwriter who just got his or her first cut and thought that the royalties from that would get them out of debt. This is about the producer who works tirelessly to innovate and create, just like the innovators and creators at Apple are pioneering in their field…but will not get paid for a quarter of a year’s worth of plays on his or her songs.

These are not the complaints of a spoiled, petulant child. These are the echoed sentiments of every artist, writer and producer in my social circles who are afraid to speak up publicly because we admire and respect Apple so much. We simply do not respect this particular call.

I realize that Apple is working towards a goal of paid streaming. I think that is beautiful progress. We know how astronomically successful Apple has been and we know that this incredible company has the money to pay artists, writers and producers for the 3 month trial period… even if it is free for the fans trying it out. 

Three months is a long time to go unpaid, and it is unfair to ask anyone to work for nothing. I say this with love, reverence, and admiration for everything else Apple has done. I hope that soon I can join them in the progression towards a streaming model that seems fair to those who create this music. I think this could be the platform that gets it right. "

Update 3 (06/22/15): Apple has agreed to pay for Apple Music products (read: music) they plan to use during their free 3-month trial period.

Update 4 (06/23/15): It appears that Taylor Swift has some explaining to do towards professional photographers, as it seems they do not wholly own their work (what the fu...?!?!?!). A complete contract and comments are available at this link. So Taylor Swift, are you going to allow professional photographers / visual artists to have the same rights you seem to be asking for from your work? And Taylor, please do not destroy a photographers equipment, since that is their livelihood. They work very hard to promote you in their photography and make far and away less money than you do. Replacing very expensive camera gear is not an easy task for those of us hard-working photojournalists in the field simply trying to make a modest living promoting other's (read: your) work.

Update 5 (06/24/15): And the hits just keep coming as it was reported that a UK representative for Taylor Swift has said to Business Insider via email:

The standard photography agreement has been misrepresented in that it clearly states that any photographer shooting The 1989 World Tour has the opportunity for further use of said photographs with management’s approval. Another distinct misrepresentation is the claim that the copyright of the photographs will be with anyone other than the photographer — this agreement does not transfer copyright away from the photographer. Every artist has the right to and should protect the use of their name and likeness.

Hmmm, then perhaps that contract needs to be amended because it very clearly states...  We look forward to all new contracts stating the above legally, lest anyone come to think that a signed legal contracts sets precedence in a court of law. Perhaps it is time Taylor Swift hires her own photographers and all other photographers decide to stop giving her publicity. That is an idea that one may consider.

Oh, and it gets deeper and deeper with each passing day. Here's another link you may want to read. And yes, this year's tour photog contract is far worse than the previous one. Taylor, just hire your own photographers and leave us hardworking types out of the mess your / your management team have created. Plus you could be like the Kardashians and sell your photos to publications, so this is a win/win for you. Am simply curious how much you'll charge publications when you finally get pregnant for first rights to baby photos and first TV interview accordingly with baby in-hand. C'mon Taylor, you're just not thinking big money enough.

We welcome your thoughts on this within Enjoy the Music.com's Facebook post concerning this deeply troubling turn of events at Apple.