To Apple, Love Taylor(taylorswift.tumblr.com)
taylorswift.tumblr.com
To Apple, Love Taylor
http://taylorswift.tumblr.com/post/122071902085/to-apple-love-taylor
533 comments
> I'd encourage you to consider the hypothetical I posted in the last thread about Apple Music's 3 month trial.
To make the analogy a little more accurate:
> Tomorrow, Apple announces that it will be introducing an "App Store Subscription." For $9.99/month users will be allowed to use one App Store app at a time. When an app is running, it will present a button allowing a user to purchase that app so that they may use it any time they want, whether or not their phone is connected to the Internet, and concurrently with other apps. During the 3 month free trial, Apple will not pay royalties for streaming apps but will pay normal royalties for any apps purchased.
This would suck for the Omni Groups and Mojangs, but absolutely awesome for tiny shops who currently make almost nothing and would now have much greater exposure. Likewise Taylor Swift doesn't need more exposure to sell her music, but Joe Garage might actually pick up a few listeners and fans. You see this is a money grab. I see this is as a necessary (and label approved!) bootstrapping for long term gain.
And in the mean time, even major artists will continue to get their current revenue stream from radio stations, Spotify, iTMS, etc. unless we really believe that Apple Music is going to gain a 100% market share immediately. Long term, even that would probably be a huge benefit to artists because it's almost certainly a better deal than they're getting from anyone else today.
To make the analogy a little more accurate:
> Tomorrow, Apple announces that it will be introducing an "App Store Subscription." For $9.99/month users will be allowed to use one App Store app at a time. When an app is running, it will present a button allowing a user to purchase that app so that they may use it any time they want, whether or not their phone is connected to the Internet, and concurrently with other apps. During the 3 month free trial, Apple will not pay royalties for streaming apps but will pay normal royalties for any apps purchased.
This would suck for the Omni Groups and Mojangs, but absolutely awesome for tiny shops who currently make almost nothing and would now have much greater exposure. Likewise Taylor Swift doesn't need more exposure to sell her music, but Joe Garage might actually pick up a few listeners and fans. You see this is a money grab. I see this is as a necessary (and label approved!) bootstrapping for long term gain.
And in the mean time, even major artists will continue to get their current revenue stream from radio stations, Spotify, iTMS, etc. unless we really believe that Apple Music is going to gain a 100% market share immediately. Long term, even that would probably be a huge benefit to artists because it's almost certainly a better deal than they're getting from anyone else today.
Exposure isn't necessarily good for an app.
Users frequently _cost_ money. Ask anyone who has significantly scaled freemium services.
Exposure to lots of users who might not use your service can kill your business.
If your service is really that good or serves a real need, you would recognize these potential users and market to them _aggressively_. You would even raise significant capital to do so if you did not have it. Seeing the value in your product, VCs would invest in you.
Even if your product has no inherent costs to provide as a service after it is made, you scale the money and time that invested in it based on your expected reach/profit and your profit model has just been thoroughly fked by Apple.
This definitely applies to people who produce music too because the product you're releasing has a profitable shelf-life (except for unicorns, really) and artists release on a schedule that their market (and they personally) can support.
You put a certain amount of money and time into an album based on how many people it will reach and the likelihood and timeframe before you can put out another one. Some artists release every few years, some every year and some release multiple albums per year.
If Apple is giving away your album for 3 months and you release 4 albums a year, they may be giving away 1/4 of your yearly income...(Think of it like Big O and worry about your worst-case performance.)
Using revenue streams that you don't control is hazardous. Relying on them is outright dangerous. Using revenue streams that you don't control AND marketing streams that you don't control? Suicide.
Note: this is not an argument for whether you should pay for music or not...that's a topic too hot for HN.
Users frequently _cost_ money. Ask anyone who has significantly scaled freemium services.
Exposure to lots of users who might not use your service can kill your business.
If your service is really that good or serves a real need, you would recognize these potential users and market to them _aggressively_. You would even raise significant capital to do so if you did not have it. Seeing the value in your product, VCs would invest in you.
Even if your product has no inherent costs to provide as a service after it is made, you scale the money and time that invested in it based on your expected reach/profit and your profit model has just been thoroughly fked by Apple.
This definitely applies to people who produce music too because the product you're releasing has a profitable shelf-life (except for unicorns, really) and artists release on a schedule that their market (and they personally) can support.
You put a certain amount of money and time into an album based on how many people it will reach and the likelihood and timeframe before you can put out another one. Some artists release every few years, some every year and some release multiple albums per year.
If Apple is giving away your album for 3 months and you release 4 albums a year, they may be giving away 1/4 of your yearly income...(Think of it like Big O and worry about your worst-case performance.)
Using revenue streams that you don't control is hazardous. Relying on them is outright dangerous. Using revenue streams that you don't control AND marketing streams that you don't control? Suicide.
Note: this is not an argument for whether you should pay for music or not...that's a topic too hot for HN.
As another separate point that I'd like here but isn't part of this comment.
I think that all transactions _inevitably_ break down when (at least) one party has no skin in the game or when they misestimate their or the counter-party's stake. (Call it the busterarm theory of economics).
The only possible skin in the game that Apple has here is their brand. Their offering here is basically a value statement that Apple's brand and what it brings is worth more than artists will be losing in streaming dollars.
I think Apple is significantly misestimating both their risk and their counter-party risk here. _And_ the risk to their brand is effectively zero. It'll be interesting to see what happens. My impression of their music offerings was that their real value was the trust they had with both artists and consumes; they probably don't see it being that way.
One cannot operate a paid media streaming music while simultaneously proposing that the value of that media is zero. There's that old business maximum that if you want to know what a company cares about, look what they spend their money on.
I think that all transactions _inevitably_ break down when (at least) one party has no skin in the game or when they misestimate their or the counter-party's stake. (Call it the busterarm theory of economics).
The only possible skin in the game that Apple has here is their brand. Their offering here is basically a value statement that Apple's brand and what it brings is worth more than artists will be losing in streaming dollars.
I think Apple is significantly misestimating both their risk and their counter-party risk here. _And_ the risk to their brand is effectively zero. It'll be interesting to see what happens. My impression of their music offerings was that their real value was the trust they had with both artists and consumes; they probably don't see it being that way.
One cannot operate a paid media streaming music while simultaneously proposing that the value of that media is zero. There's that old business maximum that if you want to know what a company cares about, look what they spend their money on.
> 4 albums a year
And that would be an incredibly productive artist. Most artists release something like 1 album every 1-2 years, at best.
And that would be an incredibly productive artist. Most artists release something like 1 album every 1-2 years, at best.
Maybe in genres of music that you're accustomed to. There are a few where high output is the norm. The output of a lot of producers and (especially) ghost-writers is pretty hard to fathom. I have a great story about Japanese record labels that's pretty long for here though.
Many well-known artists have released multiple hit records in the same year before though and many more are releasing their own albums and producing other peoples. In the early 60s popular artists sometimes put out two hit records a year (Bob Dylan, The Beatles '63-'65)...Led Zeppelin did that once in '68. David Bowie put out two hit records AND co-wrote and produced two Iggy Pop records in '77. CCR put out three LPs one year...
It happens a lot more than you realize.
Many well-known artists have released multiple hit records in the same year before though and many more are releasing their own albums and producing other peoples. In the early 60s popular artists sometimes put out two hit records a year (Bob Dylan, The Beatles '63-'65)...Led Zeppelin did that once in '68. David Bowie put out two hit records AND co-wrote and produced two Iggy Pop records in '77. CCR put out three LPs one year...
It happens a lot more than you realize.
Another thing to note is that artists often (can) produce far more music than ends up on their albums; they, or their producers / publishers, realize that not everything they produce is good music. Just like code / software. So while you can produce thousands of lines of code a day if you churn out enough, only ten or so will actually be worth keeping.
Agreed...but I hope my (or anyone's) useful output as a programmer is significantly more than 1%.
I really want to drive home the "you're going to work just as hard, but for less money" argument to get people thinking about it the right way.
It's no different than music piracy, which actually I don't care about, just don't be dishonest about doing it as a business.
I really want to drive home the "you're going to work just as hard, but for less money" argument to get people thinking about it the right way.
It's no different than music piracy, which actually I don't care about, just don't be dishonest about doing it as a business.
> Exposure isn't necessarily good for an app. Users
> frequently _cost_ money. Ask anyone who has
> significantly scaled freemium services.
Not necessarily. Cost of users isn't linear with count of users and while it might go down as your userbase grows, you might not have the finances yet to handle that growth.
You can't just "be ready to host a 100 million users, tomorrow" in the early stages of your business.
You can't just "be ready to host a 100 million users, tomorrow" in the early stages of your business.
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If you don't have a contingency plan for how you will handle - operationally, financially, infrastructure-perspective, monetization - user scaling at speed, then not only is your business a charity, it's a hobby, too.
If there are credible signs you will acquire 100m users tomorrow, and you can't walk in to a VC and walk out with a big chunk of money for a small amount of equity, it means you don't have a real business plan.
Additionally, I would be interested in any examples you have of companies acquiring 100m users overnight, or anything within two orders of magnitude of that.
If there are credible signs you will acquire 100m users tomorrow, and you can't walk in to a VC and walk out with a big chunk of money for a small amount of equity, it means you don't have a real business plan.
Additionally, I would be interested in any examples you have of companies acquiring 100m users overnight, or anything within two orders of magnitude of that.
Accidents happen. Partners cheat. Here is a simple example from Shift Jelly about Amazon App store and their free app of the day.
http://blog.shiftyjelly.com/2011/08/02/amazon-app-store-rott...
> All we got was about 300 emails a day to answer over the space of a few weeks, that left us tired and burnt out. For all we know most of the people who wanted our application, now have it. To add insult to injury Pocket Casts relies on a server to parse podcast feeds (allowing instant updates on your phone), and all these new users forced us to buy more hardware just to meet demand. Hardware that we are going to have to support indefinitely at our own cost.
Can you fault Shift Jelly for not being able to see through this?
http://blog.shiftyjelly.com/2011/08/02/amazon-app-store-rott...
> All we got was about 300 emails a day to answer over the space of a few weeks, that left us tired and burnt out. For all we know most of the people who wanted our application, now have it. To add insult to injury Pocket Casts relies on a server to parse podcast feeds (allowing instant updates on your phone), and all these new users forced us to buy more hardware just to meet demand. Hardware that we are going to have to support indefinitely at our own cost.
Can you fault Shift Jelly for not being able to see through this?
Amazon offered them a deal. Amazon made the terms of that deal super clear by putting it in bold type. Shifty Jelly accepted that deal. Calling that cheating is beyond comprehension.
That's the thing about "exposure" though.
You have no control over it.
You can't plan for it.
You are missing the point. 100 million was just a number. The corpses of businesses that scaled past their ability to serve their customers are real.
But part of your argument has merit: it's the same reason that "exposure" doesn't create album sales. There's no real chance (really, there isn't) that you have a product that will reach 100m people tomorrow, so you shouldn't be producing music as if you would.
But part of your argument has merit: it's the same reason that "exposure" doesn't create album sales. There's no real chance (really, there isn't) that you have a product that will reach 100m people tomorrow, so you shouldn't be producing music as if you would.
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> You can't plan for it.
> The corpses of businesses that scaled past their ability
> to serve their customers are real.
> Sounds like a good way to get sued by your investors.
You can try and anticipate it and you can model the risk and try to mitigate downside risk. You cannot "plan" for it though - it's a factor outside of your direct control. It's not a target you can hit or not hit, you just are prepared and lucky either way.
> Turns out that a Rails App + someone calling themselves a "Serial Startup CEO" on LinkedIn don't necessarily equate to a business.
Rails, like any other tool/framework, works perfectly well for certain kinds of problems. I would say this is very true for the kinds of businesses that most "serial startup CEOs" are solving. Twitter gave Rails a bad reputation because Twitter's problem was exceptionally bad for Rails at Twitter's scale. In most other cases it's just poor engineering discipline, whether it's in choice of tool or how it is used. It turns out that ActiveRecord isn't really a great tool for dealing with 450M+ write transactions per day. Wasn't designed to be.
Rails is powerful and ubiquitous for very good reasons. The tools that often get the most hate end up quietly doing their jobs or, worse, growing up and becoming better and everywhere. JavaScript, PHP, Lisp, C, Java? And that's just a few programming langauges...There's a holy war over Text Editors that aren't ever going away.
It's not a "web 2.0 startup" specific problem we're talking about. Rapid growth is notoriously one of _the most common_ reasons that companies fail (regardless of if that failure puts them out of business or not).
> Turns out that a Rails App + someone calling themselves a "Serial Startup CEO" on LinkedIn don't necessarily equate to a business.
Rails, like any other tool/framework, works perfectly well for certain kinds of problems. I would say this is very true for the kinds of businesses that most "serial startup CEOs" are solving. Twitter gave Rails a bad reputation because Twitter's problem was exceptionally bad for Rails at Twitter's scale. In most other cases it's just poor engineering discipline, whether it's in choice of tool or how it is used. It turns out that ActiveRecord isn't really a great tool for dealing with 450M+ write transactions per day. Wasn't designed to be.
Rails is powerful and ubiquitous for very good reasons. The tools that often get the most hate end up quietly doing their jobs or, worse, growing up and becoming better and everywhere. JavaScript, PHP, Lisp, C, Java? And that's just a few programming langauges...There's a holy war over Text Editors that aren't ever going away.
It's not a "web 2.0 startup" specific problem we're talking about. Rapid growth is notoriously one of _the most common_ reasons that companies fail (regardless of if that failure puts them out of business or not).
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It's a marketing channel. You pay real costs to provision and support free users so that some of them will become paid users.
It only works if there is a high enough proportion of conversions to paid.
It only works if there is a high enough proportion of conversions to paid.
> It only works if there is a high enough proportion of
> conversions to paid.
Unless you happen to be this Summer's big record... in which case your one profitable window for your track will have has just been obliterated.
Lets say you are that artist. You have practiced, trained, studied. You have worked hard and have a rare natural talent. You sang the songs and played guitar. Now you have "this summer's big record". Two million children want to listen to your song (without paying any additional costs) 50-100 times over the next 3 months, and then never again.
How much is that worth to society? How much money should you make from that?
Consider an elementary teacher tasked with teaching 28 children to read and guiding them to becoming active participants in democracy rather than repeat offenders. $50k/yr. Compare a state university computer science professor who will teach dozens of new jacks this year how to measure and optimize algorithms-- setting them up for a life of full time employment while all their friends tread in the sea of shit and unemployment around them. $90k/yr. Consider a bus driver, a construction worker, a civil engineer, anyone who didnt have a chance to finish high school or College and still goes to work every day. Or those who went to ivy league colleges and resisted the urge to go into finance. Productive people.
We are all productive and we all add value, and we are underpaid. Our kids will have varying access to good education. We have less access to inferior healthcare. We spend too much time at work and not enough time with our kids. The lowest of us live in poverty and violence, relegated to feeding our children less healthy, life shortening diets. And thats just in the U.S., one of the wealthiest states on the planet.
Now how much is that song you sang worth?
Artists should be about art. If you dont like the fact that Apple wants you to be their slave, then distribute your music yourself. If people dont want to pay for your music, then keep doing what you want to do and starve or start doing what they want you to do and make money. But dont try to be about the art and say the faceless evil corporation should pay you more. It is disrespectful to the productive workers of the world.
How much is that worth to society? How much money should you make from that?
Consider an elementary teacher tasked with teaching 28 children to read and guiding them to becoming active participants in democracy rather than repeat offenders. $50k/yr. Compare a state university computer science professor who will teach dozens of new jacks this year how to measure and optimize algorithms-- setting them up for a life of full time employment while all their friends tread in the sea of shit and unemployment around them. $90k/yr. Consider a bus driver, a construction worker, a civil engineer, anyone who didnt have a chance to finish high school or College and still goes to work every day. Or those who went to ivy league colleges and resisted the urge to go into finance. Productive people.
We are all productive and we all add value, and we are underpaid. Our kids will have varying access to good education. We have less access to inferior healthcare. We spend too much time at work and not enough time with our kids. The lowest of us live in poverty and violence, relegated to feeding our children less healthy, life shortening diets. And thats just in the U.S., one of the wealthiest states on the planet.
Now how much is that song you sang worth?
Artists should be about art. If you dont like the fact that Apple wants you to be their slave, then distribute your music yourself. If people dont want to pay for your music, then keep doing what you want to do and starve or start doing what they want you to do and make money. But dont try to be about the art and say the faceless evil corporation should pay you more. It is disrespectful to the productive workers of the world.
Let's say you release a technical book that you've spent a year of your life writing (Not to mention the years of education and training to gather the knowledge to write it). It's for a hot new, but somewhat niche, technology, and you release it just as Amazon decides all ebooks are free for three months. It's a #1 new release, and the buzz from the new release publicity sells tens of thousands of copies in the first few months. Afterwards, everyone who wants it has a copy, and the sales months later are somewhat meager. The technology you wrote it for is later replaced by some new Ruby library, so there aren't a lot of kids picking it up that might be interested in your book -- sales flatten.
Sure, you didn't write anything that was going to join the ranks of "The Art of Computer Programming," but surely you wouldn't be okay just giving up the hundred thousand dollars or so in royalties you could have made? Without artists writing hit summer songs, there would be no hit summer songs. Without people writing flavor-of-the-month technical books, we wouldn't have those either. You might scoff, but people should be paid for these things.
"If you dont like the fact that Apple wants you to be their slave, then distribute your music yourself." That's exactly what Taylor is doing. What's your point?
Sure, you didn't write anything that was going to join the ranks of "The Art of Computer Programming," but surely you wouldn't be okay just giving up the hundred thousand dollars or so in royalties you could have made? Without artists writing hit summer songs, there would be no hit summer songs. Without people writing flavor-of-the-month technical books, we wouldn't have those either. You might scoff, but people should be paid for these things.
"If you dont like the fact that Apple wants you to be their slave, then distribute your music yourself." That's exactly what Taylor is doing. What's your point?
I think you completely missed the point. Using your own analogies of teachers, this would sort of be like a local government letting all the teachers know that they will be teaching kids without pay for the next 3 months. If this ever happened, any teachers that could would get the hell out of dodge.
It's really not like that at all. The teacher scenario has an opportunity cost: if they're busy teaching kids for free, then they're not available for teaching other kids for pay.
In the Apple Music situation, there's likely very little opportunity cost unless we believe that it's going to be so amazingly and instantly successful that it will cannibalize all current revenue streams.
In the Apple Music situation, there's likely very little opportunity cost unless we believe that it's going to be so amazingly and instantly successful that it will cannibalize all current revenue streams.
In the Apple Music situation, there's likely very little opportunity cost unless we
believe that it's going to be so amazingly and instantly successful that it will
cannibalize all current revenue streams.
I don’t think they’d be in this business at all if they didn’t think they had a shot at rendering the competition irrelevant.
Take a look at The Wealth of Nations by Adam Smith
That just seems to result in everyone getting underpaid. Keep paying musicians, let's just figure out how to pay teachers and bus drivers and everyone else more.
If we say that musicians should be paid less because our standard as society is that everyone else is underpaid and that's fine, that's really disrespectful to the productive workers for the world.
If we say that musicians should be paid less because our standard as society is that everyone else is underpaid and that's fine, that's really disrespectful to the productive workers for the world.
That's a funny way of looking at it.
The reality is that most of the people you're talking about will "waste" their meagre salaries on trivial stuff like streaming music services and satellite TV. Taylor Swift didn't sell millions of albums to nobody.
Music is entertainment, and it makes people's crappy lives more enjoyable, and that's a pretty valuable service, which is why it can be so lucrative for some people.
The reality is that most of the people you're talking about will "waste" their meagre salaries on trivial stuff like streaming music services and satellite TV. Taylor Swift didn't sell millions of albums to nobody.
Music is entertainment, and it makes people's crappy lives more enjoyable, and that's a pretty valuable service, which is why it can be so lucrative for some people.
> Lets say you are that artist. You have practiced, trained, studied. You have worked hard and have a rare natural talent. You sang the songs and played guitar. Now you have "this summer's big record".
You should read KLF's The Manual. For purposes of achieving "this summer's big record", there's quite often not a lot of correlation with training, study, talent, etc.
Not saying that's always the case and in particular, it's very different with artists producing more than two or three top10 hits, over time, or producing more than one successful full album with good sales. It's that consistency and prolonged creativity that really requires the talent and training. For the #1 big summer hit, it often suffices to just be lucky, hitting the right gimmick and vibe at the right time, just like a video or meme going viral.
You should read KLF's The Manual. For purposes of achieving "this summer's big record", there's quite often not a lot of correlation with training, study, talent, etc.
Not saying that's always the case and in particular, it's very different with artists producing more than two or three top10 hits, over time, or producing more than one successful full album with good sales. It's that consistency and prolonged creativity that really requires the talent and training. For the #1 big summer hit, it often suffices to just be lucky, hitting the right gimmick and vibe at the right time, just like a video or meme going viral.
That assumes every Apple Music user is on their 3 month free trial at the same time. This 3 month trial won't even be a consideration in a year, as the majority of users will be past theirs. In reality, at any given moment a small percentage of users will be in the free trial period (excluding the first 3 months of the service being generally available).
Well, 100% of users will be on a 3 month trial the first year that they use a service, so it doesn't matter when it happens. For any successful service, the number of those users should grow YoY, at least for a while. (We're growing so fast, the number of people listening to your album for free has an exponential growth curve! SEE? WE'RE CRUSHING IT!)
Most artists aren't successful (if even) for more than a few years at best. The lifespan of their albums even less so.
(Some old data: http://frumin.net/ation/2008/05/climb_the_charts_schmimb_the... )
Okay, it might matter when it happens: It might be really catastrophic to release your album right when the service starts (actually it sounds like Ms. Swift is pretty smart now, eh?). Though then you might want to hold off for a whole year entirely. Hold on now, why is Apple dictating the release schedule of my albums? I thought they weren't a record label...
...oh wait.
Most artists aren't successful (if even) for more than a few years at best. The lifespan of their albums even less so.
(Some old data: http://frumin.net/ation/2008/05/climb_the_charts_schmimb_the... )
Okay, it might matter when it happens: It might be really catastrophic to release your album right when the service starts (actually it sounds like Ms. Swift is pretty smart now, eh?). Though then you might want to hold off for a whole year entirely. Hold on now, why is Apple dictating the release schedule of my albums? I thought they weren't a record label...
...oh wait.
I'm not making any statement on whether it's good or bad, right or wrong, but ...
Software developers aren't immune to piracy's effects, either. Whether we like it or not, we're quickly shifting into a world where art is only viable as a labor of love. Everything being digital means copying is free. Scarcity has gone out the window. Now if only our increased productivity and automations led to lesser and lesser working hours, we'd all have a lot more time for artistic endeavors on the side.
But yes, it's becoming increasingly difficult to sustain yourself solely as an artist. Life isn't fair, unfortunately.
Would the world be better if we had purely gratis art? I don't know ... the production values would certainly be a lot lower. But maybe people doing things solely because they enjoy it, rather than for the paycheck, would result in more passion and creativity; and less cash grabs. Or maybe everything would be awful.
Either way, it seems futile to rail against something none of us can possibly change, and wish for the good old days of $15 CDs with one good song on it, or $200 OS installation CDs, or $800 paint programs.
Software developers aren't immune to piracy's effects, either. Whether we like it or not, we're quickly shifting into a world where art is only viable as a labor of love. Everything being digital means copying is free. Scarcity has gone out the window. Now if only our increased productivity and automations led to lesser and lesser working hours, we'd all have a lot more time for artistic endeavors on the side.
But yes, it's becoming increasingly difficult to sustain yourself solely as an artist. Life isn't fair, unfortunately.
Would the world be better if we had purely gratis art? I don't know ... the production values would certainly be a lot lower. But maybe people doing things solely because they enjoy it, rather than for the paycheck, would result in more passion and creativity; and less cash grabs. Or maybe everything would be awful.
Either way, it seems futile to rail against something none of us can possibly change, and wish for the good old days of $15 CDs with one good song on it, or $200 OS installation CDs, or $800 paint programs.
> Software developers aren't immune to piracy's effects, either. Whether we like it or not, we're quickly shifting into a world where art is only viable as a labor of love. Everything being digital means copying is free.
Isn't this one of the big reasons for the rise of SaaS apps, though? Developers, unlike musicians, have found a way to combat piracy in a way that both consumers seem to prefer (lower upfront costs and usage based pricing) and developers benefit from (more revenue over time in exchange for delivering real value).
Besides, being forced to provide 3 months of free usage without any say in the matter is hardly defensible due to piracy. It's even less defensible when the party enforcing the free usage is the party that stands to benefit most from it.
Isn't this one of the big reasons for the rise of SaaS apps, though? Developers, unlike musicians, have found a way to combat piracy in a way that both consumers seem to prefer (lower upfront costs and usage based pricing) and developers benefit from (more revenue over time in exchange for delivering real value).
Besides, being forced to provide 3 months of free usage without any say in the matter is hardly defensible due to piracy. It's even less defensible when the party enforcing the free usage is the party that stands to benefit most from it.
Do consumers prefer SaaS? The reaction to Windows and Office becoming subscription software seems pretty uniformly negative.
Even if users grouse about it, they seem to prefer it versus a big one time upfront purchase based on their usage/purchase patterns. Of course, what they'd probably really prefer is a low one time upfront purchase, but that's typically not tenable for the software business.
Users rarely get a choice when vendors decide to switch to rent-seeking licensing models, so where is it that they seem to prefer it?
I know lots of people who are happy to pay $49 a month instead of the $2000 that Adobe Master Collection was.
For me it depends on the software and how much value new features bring to that software.
For two examples:
I've actually been pretty pleased with Lightroom/Photoshop as SaaS because these apps still often have new innovations that actually make my life easier as a hobbyist photographer. Thus I don't mind paying per month because I'd probably already be upgrading to the new version every year anyway and this is just spreading a similar cost out over time.
OTOH, Office's switch to SaaS is what finally pushed me over the edge to using free ("as in beer") alternatives... they can keep rejiggering the UI this way and that way but I can't imagine what they would add to Word or Excel that would make them seriously more useful to me, it was never a must-upgrade for me (YMMV if you work in an enterprise office setting or whatever) and thus the SaaS move is not good for my usage.
For two examples:
I've actually been pretty pleased with Lightroom/Photoshop as SaaS because these apps still often have new innovations that actually make my life easier as a hobbyist photographer. Thus I don't mind paying per month because I'd probably already be upgrading to the new version every year anyway and this is just spreading a similar cost out over time.
OTOH, Office's switch to SaaS is what finally pushed me over the edge to using free ("as in beer") alternatives... they can keep rejiggering the UI this way and that way but I can't imagine what they would add to Word or Excel that would make them seriously more useful to me, it was never a must-upgrade for me (YMMV if you work in an enterprise office setting or whatever) and thus the SaaS move is not good for my usage.
The free alternatives are just 1990s-style office suites.
Compared with Office 365, you don't get the free 1TB of cloud storage, the 50GB mailbox, the full online versions of Office, the ability to stream Office programs without installing them (so you can use them on, say, a cybercafe PC), the add-ons and extensions, the cross-platform tablet and smartphone apps, the free upgrade to the next version of Office, and so on.
Office 365 is a huge ecosystem play, whereas OO/LO have no ecosystems.
Otherwise, UI changes are annoying, but the basic Office UI hasn't really changed since 2007. It changes less often than, say, Gmail.
Compared with Office 365, you don't get the free 1TB of cloud storage, the 50GB mailbox, the full online versions of Office, the ability to stream Office programs without installing them (so you can use them on, say, a cybercafe PC), the add-ons and extensions, the cross-platform tablet and smartphone apps, the free upgrade to the next version of Office, and so on.
Office 365 is a huge ecosystem play, whereas OO/LO have no ecosystems.
Otherwise, UI changes are annoying, but the basic Office UI hasn't really changed since 2007. It changes less often than, say, Gmail.
Personally I do not perceive software as SaaS if it is not browser based. That's where the synergy comes from - easier to debug, maintain, etc.
On the other hand, historically, art hasn't paid very well. I suspect the modern artists-get-rich era started with Elvis. That era may be an aberration and be drawing to a close.
In my own profession, writing compilers, you simply can't sell them anymore. That hasn't deterred me from continuing to do so, I just adapt and find other ways to make a living from the business.
In my own profession, writing compilers, you simply can't sell them anymore. That hasn't deterred me from continuing to do so, I just adapt and find other ways to make a living from the business.
" I suspect the modern artists-get-rich era started with Elvis."
A little further back than that, but not much further. Frank Sinatra, maybe. With radio and recordings, for the first time a musician could get revenue from people far away.
"In my own profession, writing compilers, you simply can't sell them anymore."
Compilers, operating systems, browsers... Maybe software as an industry only had a limited lifespan. In the early IBM mainframe era, machines were expensive, vendor-provided software was usually included, and there was not much of a third-party software industry. Now, software is very cheap, and ancillary to advertising or services.
A little further back than that, but not much further. Frank Sinatra, maybe. With radio and recordings, for the first time a musician could get revenue from people far away.
"In my own profession, writing compilers, you simply can't sell them anymore."
Compilers, operating systems, browsers... Maybe software as an industry only had a limited lifespan. In the early IBM mainframe era, machines were expensive, vendor-provided software was usually included, and there was not much of a third-party software industry. Now, software is very cheap, and ancillary to advertising or services.
It's the internet that killed paid commodity software. Before the internet, you had to pay someone to burn a CD/floppy and mail it to you, and of course it had to be worth that person's while to do it.
Internet downloading removed all the friction, and prices went to zero.
However, there's still plenty of opportunity doing service, maintenance, custom work, training, etc.
Internet downloading removed all the friction, and prices went to zero.
However, there's still plenty of opportunity doing service, maintenance, custom work, training, etc.
They also had some quite significant costs involved in making you realise that their software existed, though.
Marketing and promotion is just as costly, if not more costly, than it ever was. I know too many wonderful open source projects that failed and left their author bitter because they thought that merely creating a great program was good enough.
The "build it and they will come" is a stupid Hollywood fantasy. Even the Beatles went nowhere until they hooked up with promoter George Martin.
The "build it and they will come" is a stupid Hollywood fantasy. Even the Beatles went nowhere until they hooked up with promoter George Martin.
> The "build it and they will come" is a stupid Hollywood fantasy.
So incredibly true.
And even whenever I do try and talk about my software, people usually perceive it as an attack on competing software (you can't say why someone should use your product without implicitly stating why they shouldn't use someone else's); or as shameless self-promotion and advertising (even though it's all FOSS) =(
So incredibly true.
And even whenever I do try and talk about my software, people usually perceive it as an attack on competing software (you can't say why someone should use your product without implicitly stating why they shouldn't use someone else's); or as shameless self-promotion and advertising (even though it's all FOSS) =(
> increasingly difficult to sustain yourself solely as an artist.
The number of ways to sustain yourself has significant increased in recent times, and some of those don't even use copyright as a mean for revenue. They are by nature immune to piracy.
Taken Patreon and kickstarter. You can not pirate art which has not been created. An artist can decide how much wages they demand rather than find an other job, which incidental is how the job market works. If they agree to a certain amount, they get paid and do the work agreed on. Everyone walks away happy, the artist got paid, and art is created.
What is getting harder to do is getting repeatable paid for work you done in the past. Most programmers do work for hire, and they survive quite well on not being paid for every copy of work they once made. So long there is a strong interest for new work to be created, old work will be what validate the artist current pay.
I know a web comic that update twice a month and the author current gets paid $5k a month to do so. No copyright is involved, no police and no SOPA. Just an artist and their fans, enabled to be sustained by the basic model of people wanting more art to be created and a way for that to happen. When we describe the future as "people doing things solely because they enjoy it" we limit the market available to artist to how it was done in the past, and it seems artist themselves are instead choosing to find new ways rather than to close up shops.
The number of ways to sustain yourself has significant increased in recent times, and some of those don't even use copyright as a mean for revenue. They are by nature immune to piracy.
Taken Patreon and kickstarter. You can not pirate art which has not been created. An artist can decide how much wages they demand rather than find an other job, which incidental is how the job market works. If they agree to a certain amount, they get paid and do the work agreed on. Everyone walks away happy, the artist got paid, and art is created.
What is getting harder to do is getting repeatable paid for work you done in the past. Most programmers do work for hire, and they survive quite well on not being paid for every copy of work they once made. So long there is a strong interest for new work to be created, old work will be what validate the artist current pay.
I know a web comic that update twice a month and the author current gets paid $5k a month to do so. No copyright is involved, no police and no SOPA. Just an artist and their fans, enabled to be sustained by the basic model of people wanting more art to be created and a way for that to happen. When we describe the future as "people doing things solely because they enjoy it" we limit the market available to artist to how it was done in the past, and it seems artist themselves are instead choosing to find new ways rather than to close up shops.
> The number of ways to sustain yourself has significant increased in recent times
But so has the offer; anyone with a computer can create and publish music nowadays, which is both good and bad; good for the creative industry, bad for income for said creative industry because only a small percentage will ever see money. Same with the webcomics you noted; all you need is a computer with the worst drawing software to recreate something like XKCD. Everyone can do what they want / enjoy, but only a very, very small percentage of those will be able to sustain themselves off it - especially, or mostly, in the creative industry.
But so has the offer; anyone with a computer can create and publish music nowadays, which is both good and bad; good for the creative industry, bad for income for said creative industry because only a small percentage will ever see money. Same with the webcomics you noted; all you need is a computer with the worst drawing software to recreate something like XKCD. Everyone can do what they want / enjoy, but only a very, very small percentage of those will be able to sustain themselves off it - especially, or mostly, in the creative industry.
Do you have any evidence that there are less artists that can make a living in the current environment vs the old one? Is it possible there are more artists making a living in the current environment ?
For Patreon and Kickstarter to work, you have to be really lucky, or really popular already. It's not just enough to have a great idea. In a lot of ways, it reminds me of striking it rich on an App Store app: more luck than talent. For every successful fundraising campaign, there are thousands that go nowhere. But obviously we don't hear about the failures.
I'm 100% for this, but if Apple feels that way as well, they could do us all a favor and just come out and say it.
If any file hosting service can get shut down for piracy, Apple should be held accountable to the same laws.
Telling artists to work for free while they benefit sounds a lot like asking someone to work on spec, to which I respond: Fuck You, Pay Me (https://www.youtube.com/watch?v=jVkLVRt6c1U)
If any file hosting service can get shut down for piracy, Apple should be held accountable to the same laws.
Telling artists to work for free while they benefit sounds a lot like asking someone to work on spec, to which I respond: Fuck You, Pay Me (https://www.youtube.com/watch?v=jVkLVRt6c1U)
Culture has shifted and now piracy is not looked at as a real crime, but a passage of rite. These streaming services came around as an alternative to piracy and not paying anything for content anywhere.
We're witness the bankrupting of artists over time. And it amazes me that on a forum of content creators, you can see the self-interested individuals rationalizing it as fair. We can argue about the business models all day long, but it should be in tandem with the fact that life isn't fair, and what's happening to these artists isn't fair. The way people are talking about it, it doesn't really come off that way.
Sometimes I wonder if SOPA would have gone through and achieved the purposes it was set out to do - yes, let's be ideological for a moment and talk about the purpose vs the potential abuse. A lot of websites that harbor piracy are no now no longer available, and it's way more difficult to pirate your favorite music. What would that world be like, for consumers and artists?
Maybe more artists would pull their music from the streaming services, which were formed to fight piracy. Now all of a sudden that 9.95 per month you pay for music isn't so great, because not everyone is on there. The streaming services were built as an alternative to a crime - piracy.
To me the end result would be simple: The average user would have to pay more for their content, and that money would flow more into artists pockets, and those who work in artistic industries, which would reinforce more and better artistic creation.
I am probably one of the few: I pay for all of my content, and not on streaming services. I don't buy singles, I buy the whole album. When a friend opens a business, I don't immediately ask for a deal. I go in, and pay full price, and try to support that friend as best as I can. I may be old school - I pay for things, I am happy to pay for things. I want to financially support people who create things, because I want more people to have a means to be able to go out, create, and be rewarded for their work.
We're witness the bankrupting of artists over time. And it amazes me that on a forum of content creators, you can see the self-interested individuals rationalizing it as fair. We can argue about the business models all day long, but it should be in tandem with the fact that life isn't fair, and what's happening to these artists isn't fair. The way people are talking about it, it doesn't really come off that way.
Sometimes I wonder if SOPA would have gone through and achieved the purposes it was set out to do - yes, let's be ideological for a moment and talk about the purpose vs the potential abuse. A lot of websites that harbor piracy are no now no longer available, and it's way more difficult to pirate your favorite music. What would that world be like, for consumers and artists?
Maybe more artists would pull their music from the streaming services, which were formed to fight piracy. Now all of a sudden that 9.95 per month you pay for music isn't so great, because not everyone is on there. The streaming services were built as an alternative to a crime - piracy.
To me the end result would be simple: The average user would have to pay more for their content, and that money would flow more into artists pockets, and those who work in artistic industries, which would reinforce more and better artistic creation.
I am probably one of the few: I pay for all of my content, and not on streaming services. I don't buy singles, I buy the whole album. When a friend opens a business, I don't immediately ask for a deal. I go in, and pay full price, and try to support that friend as best as I can. I may be old school - I pay for things, I am happy to pay for things. I want to financially support people who create things, because I want more people to have a means to be able to go out, create, and be rewarded for their work.
Have you considered that most of the money goes to the label rather than to the artist? [1][2]
Unless you're paying them directly, you're still not paying the artist. Streaming and piracy don't even come close to the drain that labels put on income flow to artists. Artists made just about $23.40 for every $1000 their songs sold for in 2010, according to TechDirt [2].
I wish the world were as you described. But it's not. SOPA came close to destroying free speech online instead of guaranteeing artists their fair share.
[1]: http://www.bradsucks.net/archives/2007/05/22/where-your-musi... (an indie/marketplace artist's view)
[2]: https://www.techdirt.com/articles/20100712/23482610186.shtml (standard industry view)
Unless you're paying them directly, you're still not paying the artist. Streaming and piracy don't even come close to the drain that labels put on income flow to artists. Artists made just about $23.40 for every $1000 their songs sold for in 2010, according to TechDirt [2].
I wish the world were as you described. But it's not. SOPA came close to destroying free speech online instead of guaranteeing artists their fair share.
[1]: http://www.bradsucks.net/archives/2007/05/22/where-your-musi... (an indie/marketplace artist's view)
[2]: https://www.techdirt.com/articles/20100712/23482610186.shtml (standard industry view)
Labels put up all the capital (in the Techdirt example, they're getting a return of about 1.5:1 on a hypothetical investment of $4.4 million) but a lot of their bets don't work out, so the acts that do sell well are to some degree subsidizing the ones that don't. This doesn't make as much sense in a world of flatened low-cost distribution channels, but many digiterati have never given much thought to the economics of physical media production. IF you look at the balance sheets of media companies you see their profit margins tend to be in line with other industries - looking at it from the perspective of what actually flows back to shareholders rather than from the perspective of an individual band. After all, if a label puts out an album and it bombs, the loss falls on the label - the artist/band doesn't have any further obligation once the terms of the contract are fulfilled. In this sense, publishers act like VCs for the arts.
Labels put up all the capital
For Taylor Swift, sure. But there is an increasing number of musicians owning their own recording equipment and producing pro-level recordings out of their home (just like starting a software business out of your home is increasingly common).
For these people, they put up the capital. While I won't condone piracy of any copyrighted works at all, it's not reasonable to assume that all musical artists are impacted by copyright infringement in the same way.
Home producers may well be absolutely thrilled to make a few thousand dollars in sales a year, in order to continue funding their own work. Why take that away from them through piracy?
[There's also the argument that small act home producers should be thrilled to get the exposure even if nobody is paying for their recordings. As a home producer myself, I find a small amount of comfort in that, but professional-level recording and music equipment isn't cheap... I'll fund it with other income as needed, but I'd rather have my music outfit be self-sustaining.]
For Taylor Swift, sure. But there is an increasing number of musicians owning their own recording equipment and producing pro-level recordings out of their home (just like starting a software business out of your home is increasingly common).
For these people, they put up the capital. While I won't condone piracy of any copyrighted works at all, it's not reasonable to assume that all musical artists are impacted by copyright infringement in the same way.
Home producers may well be absolutely thrilled to make a few thousand dollars in sales a year, in order to continue funding their own work. Why take that away from them through piracy?
[There's also the argument that small act home producers should be thrilled to get the exposure even if nobody is paying for their recordings. As a home producer myself, I find a small amount of comfort in that, but professional-level recording and music equipment isn't cheap... I'll fund it with other income as needed, but I'd rather have my music outfit be self-sustaining.]
Totally agree. I just wanted to refute the argument that whether artists go unpaid doesn't matter because more of the pain will fall on the labels, which is a popular but fallacious argument.
Techdirt leans pro-piracy, just as torrentfreak does. I'll pay for my content in whichever fashion gets the artist paid the most - makes no difference to me. And I am not just talking about music. TV, Movies, etc. It's content as an entire class. All content companies are getting smashed against the backdrop of piracy.
I'll do whatever I can to support content creators.
I'll do whatever I can to support content creators.
> Techdirt leans pro-piracy
Does that make it OK for artists to get 2.34% of what listeners pay for the music they make? Or does it make TechDirt's figures wrong? If so, how?
> Or were you not paying for anything already, and then came across that info which now justified your position?
I am not striking, but I agree with everything s/he wrote. And, as it happens, I do pay for all the music and video and software I acquire. So it is simply not true that holding the opinions s/he expressed is always a rationalization for not liking to pay for things.
(And: do you actually have any evidence that striking pirates things rather than paying for them? Or do you just assume that anyone who takes a position opposing yours must be a pirate?)
Does that make it OK for artists to get 2.34% of what listeners pay for the music they make? Or does it make TechDirt's figures wrong? If so, how?
> Or were you not paying for anything already, and then came across that info which now justified your position?
I am not striking, but I agree with everything s/he wrote. And, as it happens, I do pay for all the music and video and software I acquire. So it is simply not true that holding the opinions s/he expressed is always a rationalization for not liking to pay for things.
(And: do you actually have any evidence that striking pirates things rather than paying for them? Or do you just assume that anyone who takes a position opposing yours must be a pirate?)
Is it legal for artists to sell virtual goods directly to fans, or are those rights locked up in record company contracts? That would allow separation of payment from distribution.
TPP/TTIP/RECP leaks suggest the criminalization of non-commercial copyright infringement, where prosecution will be possible even if the copyright holder does not want to prosecute, e.g. fanzines.
Can we develop a payment mechanism which moves funds from audience to artist for virtual goods, with no exchange of music (which can be obtained on any channel), but which provides a non-forgeable "protection from being prosecuted"? This would return control to the artist.
Unbundle the music license payment from music delivery payment.
TPP/TTIP/RECP leaks suggest the criminalization of non-commercial copyright infringement, where prosecution will be possible even if the copyright holder does not want to prosecute, e.g. fanzines.
Can we develop a payment mechanism which moves funds from audience to artist for virtual goods, with no exchange of music (which can be obtained on any channel), but which provides a non-forgeable "protection from being prosecuted"? This would return control to the artist.
Unbundle the music license payment from music delivery payment.
If labels were so abusive artists wouldn't use them. It's not like setting up a label is hard.
The reason labels have such high overheads is the same as for movie studios . They subsidise a lot of non-Taylor Swifts music that don't end up being profitable. The costs of the failures end up impacting the profits of the successes. The flip side is - lots of artists get studio time and songwriting time even if they haven't already proven themselves.
The reason labels have such high overheads is the same as for movie studios . They subsidise a lot of non-Taylor Swifts music that don't end up being profitable. The costs of the failures end up impacting the profits of the successes. The flip side is - lots of artists get studio time and songwriting time even if they haven't already proven themselves.
Piracy was never look at as a real crime. The "Home Taping Is Killing Music" campaign wouldn't have been launched if piracy was generally equated with a crime in society.
To me the end result would be simple: The average user would have to pay more for their content
People aren't exactly burning the money they would have otherwise spend on such content; they aren't going to stop paying their rent because they have less free music. The discretionary income of the median person is simply not that high, and a rich person won't start buying hundreds of albums to make up for the ones the working class can't afford.
And people listening to less music instead of pirating may be more just or moral or whatever, but it doesn't pay the artists' bill anymore than piracy does.
I may be old school - I pay for things, I am happy to pay for things.
I, on the other hand, am new school, part of a generation with 25%+ unemployment and many more in precarious jobs. It's not that we don't like to pay for things - it's that's often simply not an option.
If SOPA had passed, we would've just go back to sneakernet sharing.
To me the end result would be simple: The average user would have to pay more for their content
People aren't exactly burning the money they would have otherwise spend on such content; they aren't going to stop paying their rent because they have less free music. The discretionary income of the median person is simply not that high, and a rich person won't start buying hundreds of albums to make up for the ones the working class can't afford.
And people listening to less music instead of pirating may be more just or moral or whatever, but it doesn't pay the artists' bill anymore than piracy does.
I may be old school - I pay for things, I am happy to pay for things.
I, on the other hand, am new school, part of a generation with 25%+ unemployment and many more in precarious jobs. It's not that we don't like to pay for things - it's that's often simply not an option.
If SOPA had passed, we would've just go back to sneakernet sharing.
Of course "not paying for things" is an option. Nobody has a human right to Taylor Swift's music. If you can't buy it then just go listen to the radio, or use Spotify's ad supported service, or do something else.
I pay for all the movies I watch via iTunes. I never pirate movies. Most of the music I listen to is internet radio (i.e. it is free but with the artists permission). Some of my friends consider me odd, and watch more movies than I do, but that's OK.
I pay for all the movies I watch via iTunes. I never pirate movies. Most of the music I listen to is internet radio (i.e. it is free but with the artists permission). Some of my friends consider me odd, and watch more movies than I do, but that's OK.
To play devil's advocate, no artist has a human right to payment for a digital copy - or any copy, for that matter - either. It's a negotiated arrangement, not a fundamental truth.
Of course "not paying for things" is an option
That's not what I said, please read again.
Nobody has a human right to Taylor Swift's music. If you can't buy it then just go listen to the radio, or use Spotify's ad supported service, or do something else.
Sure. That's why I said it might be more just and moral. Please read my post attentively before replying.
But how many artists has your self-sacrifice of not pirating actually helped, compared to someone who spends the same amount but also pirates?
That's not what I said, please read again.
Nobody has a human right to Taylor Swift's music. If you can't buy it then just go listen to the radio, or use Spotify's ad supported service, or do something else.
Sure. That's why I said it might be more just and moral. Please read my post attentively before replying.
But how many artists has your self-sacrifice of not pirating actually helped, compared to someone who spends the same amount but also pirates?
> use Spotify's ad supported service
I do believe that in Taylor Swift's case, you can't; at least not all of it. She didn't put her latest album on Spotify either. Honestly, I've got little sympathy for her: she's the most famous and successful singer-songwriter in the last decade by far, and these sorts of stunts don't really endear her in my eyes. But she doesn't care, 'cause haters gonna hate hate hate, right?
I do believe that in Taylor Swift's case, you can't; at least not all of it. She didn't put her latest album on Spotify either. Honestly, I've got little sympathy for her: she's the most famous and successful singer-songwriter in the last decade by far, and these sorts of stunts don't really endear her in my eyes. But she doesn't care, 'cause haters gonna hate hate hate, right?
> on a forum of content creators
I'm not a "content creator", I'm a developer. What I do has a lot more in common with what a plumber or an electrician does than with what Taylor Swift does. My programs are not expressions of my soul, they're well-crafted tools to solve a particular problem that I have either a) been paid to solve, or b) hope to sell to somebody else to solve their problem.
I'm not a "content creator", I'm a developer. What I do has a lot more in common with what a plumber or an electrician does than with what Taylor Swift does. My programs are not expressions of my soul, they're well-crafted tools to solve a particular problem that I have either a) been paid to solve, or b) hope to sell to somebody else to solve their problem.
I don't think you can pin it all on piracy; it's just the usual race-to-the-bottom. The App Store has had a constant (low) piracy rate ever since the first jailbreak, and nevertheless free-to-play revenue is 80% and increasing.
Music is always competing with its back catalog, and old music weathers the years a lot better than old video games.
Music is always competing with its back catalog, and old music weathers the years a lot better than old video games.
> These streaming services came around as an alternative to piracy and not paying anything for content anywhere.
Maybe I'm an edge case, but I bought music until I got a Spotify subscription. Now the only time I buy is when it's not available (for instance, Tech N9ne latest album was on iTunes a week or two before Spotify)
Maybe I'm an edge case, but I bought music until I got a Spotify subscription. Now the only time I buy is when it's not available (for instance, Tech N9ne latest album was on iTunes a week or two before Spotify)
*rite of passage
Agree for different reasons.
I don't think they're being greedy, any more than I think users are being entitled when they wait for steep discounts on Steam games or refuse to pay .99 for an app someone worked really hard on.
Price trends towards marginal cost, and marginal cost for digital IP is zero. That's true if everyone on both sides is a group of angels, devils, spoiled brats, or automatons.
I don't think they're being greedy, any more than I think users are being entitled when they wait for steep discounts on Steam games or refuse to pay .99 for an app someone worked really hard on.
Price trends towards marginal cost, and marginal cost for digital IP is zero. That's true if everyone on both sides is a group of angels, devils, spoiled brats, or automatons.
I am all in her camp on this one.
Most services eat the cost of trial periods in hopes of snaring subscribers and making up the loss. Apple is being dishonest by claiming free trial while passing off the costs to the artists by relying on Apple's name and status so as not to have people question it. In other words, they are spinning the story faster that old 78s
Most services eat the cost of trial periods in hopes of snaring subscribers and making up the loss. Apple is being dishonest by claiming free trial while passing off the costs to the artists by relying on Apple's name and status so as not to have people question it. In other words, they are spinning the story faster that old 78s
By your logic, Apple should pay for the music and give it away free since they are the ones who will benefit.
But that means that if revenues rise as a result of the new service, Apple should keep all the extra profit rather than sharing it with the artists.
Is that what you really want?
But that means that if revenues rise as a result of the new service, Apple should keep all the extra profit rather than sharing it with the artists.
Is that what you really want?
Apple wants to give it away for free, not the artists. Apple needs the artists, hence they need to pay.
Revenue rising with the new service will eat into the other revenue streams from sales. Subscription revenue has already been proven to be laughable with Spotify.
Saying that Apple gets to keep all the extra profit because they paid the artists during arbitrary terms set by Apple is incredibly short sighted, as the profit you speak of means profit to Apple, but a loss to the music industry.
Revenue rising with the new service will eat into the other revenue streams from sales. Subscription revenue has already been proven to be laughable with Spotify.
Saying that Apple gets to keep all the extra profit because they paid the artists during arbitrary terms set by Apple is incredibly short sighted, as the profit you speak of means profit to Apple, but a loss to the music industry.
> Subscription revenue has already been proven to be laughable with Spotify.
True, but that's because the labels keep the vast majority of Spotify's payout.
True, but that's because the labels keep the vast majority of Spotify's payout.
This is simply false. Apple's deal shares more revenue with the artists than any other service. Therefore if users adopt Apple Music, the artists will get more in aggregate.
http://recode.net/2015/06/15/heres-what-happens-to-your-10-a...
My point is not that I believe that Apple should keep the excess profit. It's that if Apple's service increases the overalls profit for the artists it's reasonable that they should share in the costs of marketing. Otherwise the artists are double dipping.
http://recode.net/2015/06/15/heres-what-happens-to-your-10-a...
My point is not that I believe that Apple should keep the excess profit. It's that if Apple's service increases the overalls profit for the artists it's reasonable that they should share in the costs of marketing. Otherwise the artists are double dipping.
Artists are double dipping? Boy I hope you don't run into an artist who knows that you just said this...
An artist like Taylor swift, you mean, worth $300M?
There are a lot of economic differences between music and apps (e.g. price range, labels negotiate on behalf of artists, music has dozens of outlets versus 2-3 for apps, etc), but my hope is you would still analyze the economics before ditching. If you ultimately would stand to make more money through subscriptions in the long term, despite losing three months of revenue, then it would make sense to stay, right?
There are a lot of economic differences between music and apps
Are there? (At least for independent musicians?) From my experience, it seems like a decent comparison—you can make an app or album for $2000 or $200k.
Are there? (At least for independent musicians?) From my experience, it seems like a decent comparison—you can make an app or album for $2000 or $200k.
To me there are, but I'm open to discussion.
- Different pricing. Apps can be anywhere from $1 to $500, while songs typically hover around $0.99. The wide variance in app pricing makes a subscription model challenging to satisfy all users and developers.
- Different markets. When you make an app, you're tying it to be used on a specific platform. It is additional work to make it cross-platform. That alone is limiting for an apps' market, and in the case of iOS, the platform's owner can impose additional limits. Music is open-ish in the sense that you can make music once and release it in a way that it's playable, essentially, everywhere.
- Different revenue streams. Music is a digital good like apps, but it's also a physical good (CDs, records) and most importantly it's a service (live performances). It's possible to have additional revenue streams with apps, but it's not as common as it is with music. If Apple spontaneously created an app subscription model and your app was iOS only, you would suddenly be very locked into that business model, whereas with music you will always have additional options.
- Different pricing. Apps can be anywhere from $1 to $500, while songs typically hover around $0.99. The wide variance in app pricing makes a subscription model challenging to satisfy all users and developers.
- Different markets. When you make an app, you're tying it to be used on a specific platform. It is additional work to make it cross-platform. That alone is limiting for an apps' market, and in the case of iOS, the platform's owner can impose additional limits. Music is open-ish in the sense that you can make music once and release it in a way that it's playable, essentially, everywhere.
- Different revenue streams. Music is a digital good like apps, but it's also a physical good (CDs, records) and most importantly it's a service (live performances). It's possible to have additional revenue streams with apps, but it's not as common as it is with music. If Apple spontaneously created an app subscription model and your app was iOS only, you would suddenly be very locked into that business model, whereas with music you will always have additional options.
> while songs typically hover around $0.99.
This is slightly off topic, but it seems that iTunes song prices have silently increased to $1.29, which is a huge increase. There are still some $0.99 songs out there, but most of the tracks I buy are $1.29.
This is slightly off topic, but it seems that iTunes song prices have silently increased to $1.29, which is a huge increase. There are still some $0.99 songs out there, but most of the tracks I buy are $1.29.
$1.29? Luxury!
Seriously though, here in Australia the regular price for a track is $2.19 -- which is absolutely ludicrous to be honest. As of today, that's the equivalent of $1.70USD
Seriously though, here in Australia the regular price for a track is $2.19 -- which is absolutely ludicrous to be honest. As of today, that's the equivalent of $1.70USD
You're missing the biggest difference: longevity. An album can sell for 50+ years whereas an app... well, let's just say it's one step above "ephemeral".
All the more reason app developers shouldn't/wouldn't go for such a deal.
All the more reason app developers shouldn't/wouldn't go for such a deal.
It seems like the more difficult barrier to this model is the technical difference between music and apps. In order for a piece of music to play in the background 24/7, the user has to pretty much explicitly allow it. In order for an app to do the same thing, the user just has to grant it enough permissions.
You can sell support for software and usage for an app. There's very few recurrent revenue in music.
Sure there is - live shows.
Yeah, but touring has a crazy pile of expenses associated, in addition to all the unfortunateness of being on the road for as long as you want to make money at it.
http://www.digitalmusicnews.com/permalink/2014/11/25/band-ju...
http://www.digitalmusicnews.com/permalink/2014/11/25/band-ju...
It's not that I'm unsympathetic to the artists, but I think that it's unrealistic that they'd expect otherwise.
A career in tech has a crazy pile of expenses associated (Stanford isn't giving away comp sci degrees; continuing education unless you want to end up a one-trick pony), in additional to all the unfortunateness of having to live in a hyper-expensive tech hub for as long as you want to make money at it.
Yeah, you can much cheaper degree (I did) and live in a cheaper region (I had), but that almost guarantees hitting a lower career ceiling than if you have a Berkeley diploma and live in San Jose.
Almost all careers involve tradeoffs. If you want to rise to the limits of your abilities you're going to have to make some hard decisions. Otherwise you'll be competing with the other workers who are happy to get paid less for easier work. In tech, this means a mid-range job in a small market. For musicians, this means playing gigs in Des Moines instead of clubs in LA. Them's the breaks.
A career in tech has a crazy pile of expenses associated (Stanford isn't giving away comp sci degrees; continuing education unless you want to end up a one-trick pony), in additional to all the unfortunateness of having to live in a hyper-expensive tech hub for as long as you want to make money at it.
Yeah, you can much cheaper degree (I did) and live in a cheaper region (I had), but that almost guarantees hitting a lower career ceiling than if you have a Berkeley diploma and live in San Jose.
Almost all careers involve tradeoffs. If you want to rise to the limits of your abilities you're going to have to make some hard decisions. Otherwise you'll be competing with the other workers who are happy to get paid less for easier work. In tech, this means a mid-range job in a small market. For musicians, this means playing gigs in Des Moines instead of clubs in LA. Them's the breaks.
> A career in tech has a crazy pile of expenses associated (Stanford isn't giving away comp sci degrees
I would contend that for somebody who's already going to Be Good At This, that would be a crazy expense from a bad decision. The best three engineers I know have degrees from UMass-Lowell, UMaine, and the University of Delaware. (I'm not #2, but I went to UMaine and graduated with $20K in loans. Paid off in four years, and I slacked.)
As far as lower career ceilings--each of those people (and I) are at lead/staff-level positions in the Boston area and have not wanted for challenging or well-paying work, while having expenses less than half of your average San Francisco tech nerd. The specter of the Bay Area looms large, but I think it's silly in how all-consuming it's considered.
I would contend that for somebody who's already going to Be Good At This, that would be a crazy expense from a bad decision. The best three engineers I know have degrees from UMass-Lowell, UMaine, and the University of Delaware. (I'm not #2, but I went to UMaine and graduated with $20K in loans. Paid off in four years, and I slacked.)
As far as lower career ceilings--each of those people (and I) are at lead/staff-level positions in the Boston area and have not wanted for challenging or well-paying work, while having expenses less than half of your average San Francisco tech nerd. The specter of the Bay Area looms large, but I think it's silly in how all-consuming it's considered.
Pay-per-usage of apps (similar to streaming music) might be really interesting. Of course, games already kind of do that via IAP and it absolutely sucks, so who knows.
The way things are going, with a couple mobile games doing billions, and hundreds of thousands of others doing next to nothing, non-IAP pay-per-usage in app stores may well come sooner than most people expect.
Before Photoshop went subscription-based, I assumed they would have gone the IAP route. For example, need a blur tool? Add it for 1.99. Or buy the Retouching Pack for $25.
Pay-per-usage means that apps which are by nature both critical & valuable but also infrequently used, get no money...
That sounds like an amazing offer. who wouldn't want to trade a one time free or 99 cent payment for recurring revenue.
Well you have to split that $10/month with all the other apps that the user accessed that month(on average). So it's quite likely that your somewhat successful app wouldn't even reach the 99 cents anymore let alone 99 cents per user.
Right - and now further imagine that your app is actually making decent money before the introduction of the subscription model (like Taylor Swift does off records). How pleased with this arrangement are you going to be? I'd posit not very.
This is a pretty successful model in some countries: http://techcrunch.com/2013/03/15/kddi-smartpass/
It says it is limited to 500 apps so compared to 1.4m in the app store less people to spread the money around to. It also sounds like they removed the option of using the Android store from this quote "saying that consumers would get confused if there were two app stores — Google Play and a branded KDDI store". So there really isn't the option of their users going to a different system.
Of course, music works completely differently. I have many albums that I only listened to ten times or so. In the old model, they have still received a fair share of $10, in the new model, not so much. I can easily understand why artists want to opt out.
I am also not sure about Apple's model for the distribution of subscription fees. But e.g. in Spotify's model, it is largely large acts benefitting from indies, rather than the other way around.
http://lit.vulf.de/spotify-so-little/
I am also not sure about Apple's model for the distribution of subscription fees. But e.g. in Spotify's model, it is largely large acts benefitting from indies, rather than the other way around.
http://lit.vulf.de/spotify-so-little/
That link perfectly describes my concern with subscription systems. If Apple distribute the royalties calculated per-user rather than based on (total royalties / total number of listens system wide) I'll move over from spotify, as it will reward the bands I like more than the current system.
I like that spotify pays royalties from free accounts, I dislike that I am effectively subsidizing this as a premium user. However, at the moment I am more comfortable with this than apples '3 months no royalties' system.
Another interesting point is that for a music subscription services, there is very little keeping users tied to one provider - all I need is the ability to export my playlists. I wonder if spotify's revenue will collapse for 3 months, but if they can be better than apple, they can get it all back 3 months later.
I like that spotify pays royalties from free accounts, I dislike that I am effectively subsidizing this as a premium user. However, at the moment I am more comfortable with this than apples '3 months no royalties' system.
Another interesting point is that for a music subscription services, there is very little keeping users tied to one provider - all I need is the ability to export my playlists. I wonder if spotify's revenue will collapse for 3 months, but if they can be better than apple, they can get it all back 3 months later.
You aren't subsidizing anything. You are paying market price for a product. The seller does bizdev how they choose.
Technically true. I think for the arts this is something of an unusual case I'd describe more as an emotional than a financial transaction. I'm paying for something that I could easily get (illegally) for free. My allegiance is to the music and musicians, not to apple, spotify or anyone else providing distribution, as such 'supporting the type of music I like' is a very strong selling point, (not strong enough for me to use Tidal though!)
I presume Apple are trying to establish differentiation through the 'radio' service, but since the baseline market requirement is the ability to listen to practically anything all-you-can-eat, it'll be hard for them to achieve it there.
I presume Apple are trying to establish differentiation through the 'radio' service, but since the baseline market requirement is the ability to listen to practically anything all-you-can-eat, it'll be hard for them to achieve it there.
It might help prevent crap-tastic apps on the store because it changes the incentive structure. If the subscription is doled out in proportion to time spent in-app, the incentive on developers would be to maximize engagement time, which might be a good thing for users. For paid apps such a scheme would be a problem since it would likely reduce income, but as a way to get money to fund free apps, not a bad idea actually.
> If the subscription is doled out in proportion to time spent in-app
And think of all the cool new laborious, overcomplicated, and time-consuming UI designs we could look forward to!
And think of all the cool new laborious, overcomplicated, and time-consuming UI designs we could look forward to!
Great just more apps for me to not use... It's not like people won't try to make nicer, simpler interfaces like they already do.
> If the subscription is doled out in proportion to time spent in-app
Then what stops shady slot game app developer from keeping his app running in the background 24/7 and trashing the commons (or private garden, I guess)? Technical solutions can probably go a decent amount of the way, but there will always be a work-around...
Then what stops shady slot game app developer from keeping his app running in the background 24/7 and trashing the commons (or private garden, I guess)? Technical solutions can probably go a decent amount of the way, but there will always be a work-around...
Time spent in an app is certainly not the best measure of value. Ideally, a user could be given some flexibility to 'upvote' subscription payment allocation to apps that have the most value to them.
How do you measure time spent "in-app"? Does the app have to be in the foreground or merely running in the background? If it has to be in the foreground then how does that help apps that mainly run in the background such as RunKeeper? If it's allowed to run in the background and still get credit then won't that create an incentive for battery-draining crap that users struggle to shut down?
You're missing the main thrust of the hypothetical (arguments about how "amazing" the offer is aside):
> Apple simultaneously announces a 3 month free trial for all App Store accounts, and states that it will be making no payments to developers during that trial since users are not paying for it.
That's a terrible offer no matter how you cut it.
> Apple simultaneously announces a 3 month free trial for all App Store accounts, and states that it will be making no payments to developers during that trial since users are not paying for it.
That's a terrible offer no matter how you cut it.
What makes musicians sound more greedy or unreasonable than most is the generally passive attitude towards the innovation necessary to sustain their own income.
They expect Apple, Spotify, Pandora etcetera to take all the risk (including the major risk of being unilaterally torpedoed by those same artists), do all the upfront investment and then whine about not getting a big enough piece of the cake.
Taylor Swift is being an outlier here in the respectful way in which she communicates. And she knows it, that's why she chooses her words very carefully.
Most of these artist just bitch and whine about their percentage, ignoring the fact that, with antiquated copyright laws firmly on the side of the music industry, technology firms are taking quite insane risk in their attempts to innovate the way music connects to the listeners.
If they hadn't, sales of music would have totally flatlined by now and those artist would be way worse off.
They expect Apple, Spotify, Pandora etcetera to take all the risk (including the major risk of being unilaterally torpedoed by those same artists), do all the upfront investment and then whine about not getting a big enough piece of the cake.
Taylor Swift is being an outlier here in the respectful way in which she communicates. And she knows it, that's why she chooses her words very carefully.
Most of these artist just bitch and whine about their percentage, ignoring the fact that, with antiquated copyright laws firmly on the side of the music industry, technology firms are taking quite insane risk in their attempts to innovate the way music connects to the listeners.
If they hadn't, sales of music would have totally flatlined by now and those artist would be way worse off.
But this IS kind of what happened! Ignoring temporarily the very good points below of this not being a good analogy (you'd have to take into account one app at a time, streaming, etc), this is essentially what happened "naturally" to the app market.
Go to top revenue: none of those apps are paid. They're all free (with in app purchase). The market itself "raced to the bottom" to a world where, yeah, most the apps actually succeeding due in fact operate as if they're "free" for x months, and then you make orthogonal purchases. Sure, no one is stopping you from charging 99$ for an app on the store, but most of us know that relying on that model is like hoping you're a NBA-level player (or rock star, ha!).
Developers aren't complaining, well, they are, but aren't desperate because we at least have created an alternative for ourselves. Sure, we all wish we could charge box-sale rates, but at least we;ve figured out something to do instead. Maybe this is what the music industry needs to do. Maybe I should be able to listen to anything I want but be able to in app purchase taylor swift emoji or t-shirts or what have you. Maybe that looks like an innovative industry as opposed to having come up with exactly ONE new idea of how to sell music (rhapsody style streaming) in the last 10 years. These are teens we're talking about here. Put a teen in a mall and tell me its hard to get them to buy something. Come On! If they're not buying the EXACT something you're offering, maybe its worth tweaking it just a TINY amount.
Go to top revenue: none of those apps are paid. They're all free (with in app purchase). The market itself "raced to the bottom" to a world where, yeah, most the apps actually succeeding due in fact operate as if they're "free" for x months, and then you make orthogonal purchases. Sure, no one is stopping you from charging 99$ for an app on the store, but most of us know that relying on that model is like hoping you're a NBA-level player (or rock star, ha!).
Developers aren't complaining, well, they are, but aren't desperate because we at least have created an alternative for ourselves. Sure, we all wish we could charge box-sale rates, but at least we;ve figured out something to do instead. Maybe this is what the music industry needs to do. Maybe I should be able to listen to anything I want but be able to in app purchase taylor swift emoji or t-shirts or what have you. Maybe that looks like an innovative industry as opposed to having come up with exactly ONE new idea of how to sell music (rhapsody style streaming) in the last 10 years. These are teens we're talking about here. Put a teen in a mall and tell me its hard to get them to buy something. Come On! If they're not buying the EXACT something you're offering, maybe its worth tweaking it just a TINY amount.
>I, personally, would ditch iOS development for Android in a heartbeat if that happened.
This is kind of the problem though. You might, but most iOS developers would take the lumps and continue on as normal. iOS is too lucrative a market to ditch on philosophical grounds. After all, if Apple did adopt this policy, it's not even clear that it would be their worst offense regarding the iOS app ecosystem.
And that's the lesson Apple learned from iOS. They're just applying it now to their music store.
This is kind of the problem though. You might, but most iOS developers would take the lumps and continue on as normal. iOS is too lucrative a market to ditch on philosophical grounds. After all, if Apple did adopt this policy, it's not even clear that it would be their worst offense regarding the iOS app ecosystem.
And that's the lesson Apple learned from iOS. They're just applying it now to their music store.
I agree, Apple should front the costs during that 3 month trial period. It's just not fair to not pay artists. The only benefit I see from this is that artists can get exposure they normally wouldn't get, because of the smaller library size.
> Apple should front the costs during that 3 month trial period. It's just not fair to not pay artists.
Why? Apple negotiated that arrangement with those artists' labels, who agreed that this was a fair and equitable situation. You and I might like to think that we would have chosen otherwise, but the people involved in this contract were happy with the outcome.
Remember, Apple didn't unilaterally come up with this. They didn't just open a service and announce that they weren't going to pay anyone.
Why? Apple negotiated that arrangement with those artists' labels, who agreed that this was a fair and equitable situation. You and I might like to think that we would have chosen otherwise, but the people involved in this contract were happy with the outcome.
Remember, Apple didn't unilaterally come up with this. They didn't just open a service and announce that they weren't going to pay anyone.
> I agree, Apple should front the costs during that 3 month trial period.
Precisely. We're talking about a company with $200 billion in cash reserves asking artists - many independent and hardly famous - to subsidize their marketing efforts.
Precisely. We're talking about a company with $200 billion in cash reserves asking artists - many independent and hardly famous - to subsidize their marketing efforts.
I'd be interested in getting paid by usage rather than once upfront. And if a free trial period let people get on board that would be fine with me.
I have an app that is "expensive" ($15) but I have dedicated users who paid once four years ago and continue to use the app today. All the major updates since have been free. While I don't know whether the pay-by-usage model would be financially better for me, I'd be pretty open minded about it and wouldn't mind the free trial.
I have an app that is "expensive" ($15) but I have dedicated users who paid once four years ago and continue to use the app today. All the major updates since have been free. While I don't know whether the pay-by-usage model would be financially better for me, I'd be pretty open minded about it and wouldn't mind the free trial.
Actually, it reminds a bit of Amazon, who used to promote Android apps giving them free for a day (at the expense of the opting-in developers of course):
http://readwrite.com/2011/08/02/amazons_growing_appstore_pro...
http://readwrite.com/2011/08/02/amazons_growing_appstore_pro...
The Spotify / Apple streaming payment model isn't even as fair as that:
The revenue from all users is pooled, and then divided per listen rather than per user/artist etc.
So this'd be like splitting the app store sub revenue by "app launches" or some other bullshit.
Pop junk like Taylor gets a far higher fraction of revenue than they deserve, from teens listening to it non-stop.
Artists that I like get 0% of my cash, even if I listen to nothing but their music.
The system would at least be fair in scope if artists got a share of each users subscription fee, split per listen for the songs they listened to.
That the payments involved are very small and mostly go to middlemen is a separate problem, the whole system is designed to fuck niche artists.
The revenue from all users is pooled, and then divided per listen rather than per user/artist etc.
So this'd be like splitting the app store sub revenue by "app launches" or some other bullshit.
Pop junk like Taylor gets a far higher fraction of revenue than they deserve, from teens listening to it non-stop.
Artists that I like get 0% of my cash, even if I listen to nothing but their music.
The system would at least be fair in scope if artists got a share of each users subscription fee, split per listen for the songs they listened to.
That the payments involved are very small and mostly go to middlemen is a separate problem, the whole system is designed to fuck niche artists.
Can you explain why that wouldn't be a great deal for app developers? I develop iOS apps, and I'd love it if apple moved to a pay for use model.
I care about a world where the most useful apps are rewarded.
I care about a world where the most useful apps are rewarded.
> Can you explain why that wouldn't be a great deal for app developers? I develop iOS apps, and I'd love it if apple moved to a pay for use model.
While it may be the case that pay-per-use would be a great model for developers (though I'm highly dubious that this is the case for anyone that isn't making a trivial $0.99 app), that isn't the main thrust of my hypothetical.
The problem with this scenario is the loss of a full quarter of revenue from every new App Store user in the interest of Apple acquiring subscribers. Do you think it would be a great deal for app developers to not be paid for three months of every single App Store user's usage?
While it may be the case that pay-per-use would be a great model for developers (though I'm highly dubious that this is the case for anyone that isn't making a trivial $0.99 app), that isn't the main thrust of my hypothetical.
The problem with this scenario is the loss of a full quarter of revenue from every new App Store user in the interest of Apple acquiring subscribers. Do you think it would be a great deal for app developers to not be paid for three months of every single App Store user's usage?
Pay-per-use would be far better for developers making deep apps that people actually use regularly than those making trivial 99c apps that are discarded quickly. Currently, an app like Omnioutliner or Clear that improves a person's productivity over years and is used 100-1000x as much as a 99c joke app can only command a 10x higher price and is then impeded by people being reluctant to pay so much up front.
But... to address your main point - yes absolutely, I'd happily give up a quarter of revenue to move to such a scheme, where my recurring revenue would be much higher because my apps are actually used by people and have a lower barrier for new users. It would be a mutually beneficial chance for developers, apple, and consumers.
However - I do grant that developers are more likely to be able to finance this transition than musicians.
Since nobody is paying for the music during the trial, and the intended result is higher revenues for the artists (and for Apple, but notably proportionally more for the artists), it is flatly disingenuous for the artists to position Apple as getting all the benefit.
What if Apple offered the artists an advance covering the 3 months based on current iTunes revenues, and then recouped this over three years by taking a higher percentage for that period from the artists who opted for it? That would solve the problem of the 3 month gap.
But... to address your main point - yes absolutely, I'd happily give up a quarter of revenue to move to such a scheme, where my recurring revenue would be much higher because my apps are actually used by people and have a lower barrier for new users. It would be a mutually beneficial chance for developers, apple, and consumers.
However - I do grant that developers are more likely to be able to finance this transition than musicians.
Since nobody is paying for the music during the trial, and the intended result is higher revenues for the artists (and for Apple, but notably proportionally more for the artists), it is flatly disingenuous for the artists to position Apple as getting all the benefit.
What if Apple offered the artists an advance covering the 3 months based on current iTunes revenues, and then recouped this over three years by taking a higher percentage for that period from the artists who opted for it? That would solve the problem of the 3 month gap.
I disagree. The truth is, some of my most used apps are the least important and/or cheapest. This is why, if we went with a pay by usage app store plan, the true winners would be the addictive, least useful apps.
I use the Spotify app 24/7, yet I use Editorial and Pythonista (both costing around $7), an app I value to a much greater degree, sometimes just -8h daily. And the truth is, while OmniOutliner is so much usefuler than say Pinterest, people spend a lot more time on Pinterest.
Don't get me wrong, I do see why the losers are probably the 99¢ apps, after all, you probably do not use those on a concurrent basis. Yet, if we go by the hourly usage, people use social networks like Pinterest and Facebook, games like Temple Run, and music services, to a much greater degree overall.
I use the Spotify app 24/7, yet I use Editorial and Pythonista (both costing around $7), an app I value to a much greater degree, sometimes just -8h daily. And the truth is, while OmniOutliner is so much usefuler than say Pinterest, people spend a lot more time on Pinterest.
Don't get me wrong, I do see why the losers are probably the 99¢ apps, after all, you probably do not use those on a concurrent basis. Yet, if we go by the hourly usage, people use social networks like Pinterest and Facebook, games like Temple Run, and music services, to a much greater degree overall.
Sure but that's easily fixed by stipulating that ad supported services are not eligible for the payout.
Aha, but of course, these services and time wasters will just adapt to have no ads. Essentially, I fear that all apps will take the approach of being excellent time wasters or services (because that's what they're being paid for), and killing all the truly great apps that that have around 20 people using them, yet cost around $7. And are not as addictive as these time wasters. Some apps try to minimize the time spent in their apps (a losing strategy in this new economy) because people pay them for a fast, frictionless service (think Drafts), but put less time into them than a browser or addictive game.
I don't really have an expectation of making a ton of money selling my apps anyways because I can always go around the country and fill stadiums with people who want to see me use my app on a stage.
Oh wait.
Oh wait.
It's hard because music you can actually track how many people are listening to what songs and how much of the song they listen to and compensate accordingly.
If they were able to track how often a person used an app then I don't think that would be too bad except for extremely niche apps which are usually enterprise already. I would take a smaller payment if I got paid $0.01 for three minutes my app was open on a phone, rather than charging $0.99 (or even $2.99)... It depends on the app though
If they were able to track how often a person used an app then I don't think that would be too bad except for extremely niche apps which are usually enterprise already. I would take a smaller payment if I got paid $0.01 for three minutes my app was open on a phone, rather than charging $0.99 (or even $2.99)... It depends on the app though
I don't think current subscription systems make the best use of this data. I personally believe that royalties should be calculated per individual paying user account rather than aggregated over total playbacks in the service.
In other words, If I only listen to 'my favorite niche band' in a month, but don't use the service much, it's unlikely that they will see anything near the full possible share of royalties from that months $10. The system instead is biased to musicians whose fans use the system most heavily on loop - ironically more likely to be taylor swift type pop megastars.
[edit - explained more clearly by http://lit.vulf.de/spotify-so-little/]
Anyone know how apple will compare on royalties after the 3 month period compared to spotify? I've been a spotify premium subscriber since 2009, but would move to a system that meets my definition of equitable.
In other words, If I only listen to 'my favorite niche band' in a month, but don't use the service much, it's unlikely that they will see anything near the full possible share of royalties from that months $10. The system instead is biased to musicians whose fans use the system most heavily on loop - ironically more likely to be taylor swift type pop megastars.
[edit - explained more clearly by http://lit.vulf.de/spotify-so-little/]
Anyone know how apple will compare on royalties after the 3 month period compared to spotify? I've been a spotify premium subscriber since 2009, but would move to a system that meets my definition of equitable.
This is one reason I pretty much just leave classical music on in the background 16/7. I'm absolutely not abusing the service -- I'm paying a subscription for exactly the right to do this. And, it helps the artists who get most shafted by the aggregate play count payout model.
That seems wrong.. you can easily track app usage. Apple and Google have insane amounts of information about the devices and apps being used on each device.
It's worth noting that this bit:
"For $9.99/month users will receive unlimited access to all apps on the App Store. Developers will receive a share of each user's subscription payments in proportion to app usage."
is exactly what Kachingle unveiled back in 2010, and the public hated it. So, if this wasn't Apple pulling this stunt, we know how much the public would hate it.
http://kachingle.com/
"For $9.99/month users will receive unlimited access to all apps on the App Store. Developers will receive a share of each user's subscription payments in proportion to app usage."
is exactly what Kachingle unveiled back in 2010, and the public hated it. So, if this wasn't Apple pulling this stunt, we know how much the public would hate it.
http://kachingle.com/
Except how long do you think it would take Google to move to app subscriptions if that happened?
I'm not so sure. I think it'd largely have to do with developers' and consumers' reactions. If Android was suddenly ground zero for innovative, high quality apps, due to Apple alienating developers, I don't think Google would choose the same model.
Indeed, you can see Google attempting to attract developers to its ecosystem and away from Apple's in some of their recent developer policy changes (no app review times, etc).
But now we're getting way off topic. :)
Indeed, you can see Google attempting to attract developers to its ecosystem and away from Apple's in some of their recent developer policy changes (no app review times, etc).
But now we're getting way off topic. :)
Google also knows full well that they don't own their platform the way Apple does - developers would just sell directly and have users sideload, or move to Amazon's app store.
There'll always be someone making an app. You can stop producing good apps, but since most apps are already free w/ ads or are a free addon to an already existing service it probably wouldn't matter for the majority of apps people use :(
App economics are much different from music economics.
From what I have observed, most people (the casual listener) will listen to the free streaming services (pandora, apple radio, etc). When people want to listen to a specific song they listen to it on youtube.
From what I have observed, most people (the casual listener) will listen to the free streaming services (pandora, apple radio, etc). When people want to listen to a specific song they listen to it on youtube.
Steam allows full refunds within 2 weeks. You're not publishing on steam anymore?
If there was a subscription program for apps, I could see apple introducing a similar trial period.
If there was a subscription program for apps, I could see apple introducing a similar trial period.
3 months free to buy market share makes sense but I am amazed to hear that they are doing it by just not paying the content producers during those 3 months. I'd be doing the same thing in her place. Apple has the cash to run a loss leader on this.
From http://www.aboveavalon.com/notes/2015/6/13/apples-cash-dilem... it seems like Apple may not actually have the cash to do this, not in the USA at least and it would need to pay taxes on the cash it is holding outside the US to pay the majority US labels/producers/artists.
Not that this excuses what they're trying to pull here or anything. By trying to weasel out of paying any US taxes, they can't spend their own money. So in this case they really might be too poor to make this deal work otherwise.
Good for Taylor Swift to stand up to this kind of crap.
Not that this excuses what they're trying to pull here or anything. By trying to weasel out of paying any US taxes, they can't spend their own money. So in this case they really might be too poor to make this deal work otherwise.
Good for Taylor Swift to stand up to this kind of crap.
They "only" have about 22 BILLION in American cash! They can raise capital in the bond market in perpetuity secured against all their global cash. There's demand for debt like Apple's. SO, they absolutely, unequivocally, unquestionably can pay the artists. This is a business decision based on greed - just like leading a wage suppression cartel. They are not too poor!
Hmmm I was under the impression that cash was part of their operating expenses. They have retail stores, their campus, most of their employees and all their most expensive employees are all in the US too. But you're right, it's probably still enough to eat 3 months worth of royalty payments.
Also likely, this isn't going to be the only or last fuck-you Apple is going to be giving artists or content producers. The ones who agree to be screwed for the 3-month opening trial will be push-overs who can be leaned on again when the time comes.
Also likely, this isn't going to be the only or last fuck-you Apple is going to be giving artists or content producers. The ones who agree to be screwed for the 3-month opening trial will be push-overs who can be leaned on again when the time comes.
Per the RIAA, the entire recorded music industry in the US recorded under $7 Billion in revenue in 2014. Apple has north of $20 Billion in cash in the US. There are likely many reasons for Apple to make the move they did, but it is unlikely cash on hand was one of them.
"Per the RIAA, the entire recorded music industry in the US recorded under $7 Billion in revenue in 2014."
Amazing. We think of the RIAA, or "big music" as some kind of juggernaut force in society and politics - especially Internet politics.
But their entire industry top line is smaller than what fedex makes in a month.[1]
[1] http://www.nasdaq.com/symbol/fdx/revenue-eps
Amazing. We think of the RIAA, or "big music" as some kind of juggernaut force in society and politics - especially Internet politics.
But their entire industry top line is smaller than what fedex makes in a month.[1]
[1] http://www.nasdaq.com/symbol/fdx/revenue-eps
That's astonishing. I'd be interested in seeing some more statistics on the amount of lobbying vs market size compared to other industries (e.g. Transportation, Hospitality, Pharma).
Something tells me we'd see a direct correlation between the amount of lobbying and the amount of legal backing your "product" needs in order to have value (copyright protection, patents, brand trademarks, etc).
This happens all the time in "Uber vs. big taxi medallion cartel" debates.
The months there are dates marking fiscal quarters, so each number is for 3 months. Fedex monthly revenue is a bit less than $4 billion.
Sadly that's still more than enough money to bully individuals :(
You can't compare top-line revenue across industries. Fedex is capital intensive.
> By trying to weasel out of paying any US taxes, they can't spend their own money.
It's not about avoiding paying any US taxes, it's about avoiding paying US taxes on earnings abroad. This is why so many Americans living abroad are giving up their US citizenship. I'm a Brit living in London and I know several American born friends that have become British citizens to avoid paying both UK and US taxes on their earnings. In fact the current mayor of London, Boris Johnson, is Anglo_America and even though he has never lived or worked in the USA, because he had US citizenship the IRS hit him with a massive tax bill on his lifetime earnings in the UK. On what possible basis could anyone consider that appropriate? He promptly gave up his US citizenship.
The US Government's attitude to earnings abroad is IMHO utterly reprehensible. I'm not aware of any other country that does this. I'm not a US citizen but I do work for a US owned company.
It's not about avoiding paying any US taxes, it's about avoiding paying US taxes on earnings abroad. This is why so many Americans living abroad are giving up their US citizenship. I'm a Brit living in London and I know several American born friends that have become British citizens to avoid paying both UK and US taxes on their earnings. In fact the current mayor of London, Boris Johnson, is Anglo_America and even though he has never lived or worked in the USA, because he had US citizenship the IRS hit him with a massive tax bill on his lifetime earnings in the UK. On what possible basis could anyone consider that appropriate? He promptly gave up his US citizenship.
The US Government's attitude to earnings abroad is IMHO utterly reprehensible. I'm not aware of any other country that does this. I'm not a US citizen but I do work for a US owned company.
The US Government's attitude to earnings abroad
is IMHO utterly reprehensible.
America has a system of foreign tax credits - so if the American tax rate is 35% and the company was taxed 20% in the country where they made the profits, when they repatriate the money to America they only have to pay 15%.
This is much fairer than the British approach to tax-dodging which appears to be "ignore it and maybe the crooks will donate to our political party".
It's normal that companies can choose where to book revenue by performing various forms of cost shifting. The entire EU system of corporate taxation is based on that principle (tax is paid where your HQ is registered). Global tax treaties, ditto. It's the USA that is weird and exceptional in this case.
So the British approach is not to "ignore tax dodging". It's to theoretically apply the same system it's always used, along with everywhere else, whilst simultaneously trying to appease populist anger over spending cuts by branding various foreign companies as socially irresponsible, although (a) there is no chance of this making any different to austerity and (b) those companies were only following rules that were considered uncontroversial not so long ago.
It's kind of a dumb strategy.
So the British approach is not to "ignore tax dodging". It's to theoretically apply the same system it's always used, along with everywhere else, whilst simultaneously trying to appease populist anger over spending cuts by branding various foreign companies as socially irresponsible, although (a) there is no chance of this making any different to austerity and (b) those companies were only following rules that were considered uncontroversial not so long ago.
It's kind of a dumb strategy.
"It's not about avoiding paying any US taxes, it's about avoiding paying US taxes on earnings abroad."
It's also about structuring earnings so that they happen to be earned abroad.
https://en.wikipedia.org/wiki/Double_Irish_arrangement
It's also about structuring earnings so that they happen to be earned abroad.
https://en.wikipedia.org/wiki/Double_Irish_arrangement
Here are my simple thoughts.
If an entity pays for an Apple product or service in the US, Apple has earned an income. This income is without doubt subject to taxes in the US. As far as I know Apple does pay US taxes on these monies. Do we agree this far?
I don't see why we can fault Apple for not repatriating income it earned abroad. They can do as they please with it as long as they don't bring it back in the US. I'm not saying they shouldn't pay a tax if/when they bring it back. I am just saying we should not demonize them for not bringing it back.
If an entity pays for an Apple product or service in the US, Apple has earned an income. This income is without doubt subject to taxes in the US. As far as I know Apple does pay US taxes on these monies. Do we agree this far?
I don't see why we can fault Apple for not repatriating income it earned abroad. They can do as they please with it as long as they don't bring it back in the US. I'm not saying they shouldn't pay a tax if/when they bring it back. I am just saying we should not demonize them for not bringing it back.
Here are my thoughts:
America invented the transistor and Internet with tax money, plus educated most of the engineers who built those products up to grade 12. But everyone acts like it'd be some moral tragedy for Apple to pay taxes back into that system. It's disgusting. Our society has been overrun by MBAs. Nobody thought like this 30 years ago.
Also you completely ignored my actual point about the flexibility of where money was 'earned' if you have good accountants.
America invented the transistor and Internet with tax money, plus educated most of the engineers who built those products up to grade 12. But everyone acts like it'd be some moral tragedy for Apple to pay taxes back into that system. It's disgusting. Our society has been overrun by MBAs. Nobody thought like this 30 years ago.
Also you completely ignored my actual point about the flexibility of where money was 'earned' if you have good accountants.
> On what possible basis could anyone consider that appropriate?
Not a US citizen here, but I think the reason is that a US citizen has more privileges than someone else: it's easier to travel and get a work permit abroad, if something goes badly they are still under protection of the US government, etc.
This is due to the fact that USA are the most powerful country on Earth, and one of the reasons for that is its military power, which is very expensive.
So the US citizen residing somewhere else would still have to pay their share to be protected by their country.
Not saying that I completely agree but I think it's a valid reason.
Not a US citizen here, but I think the reason is that a US citizen has more privileges than someone else: it's easier to travel and get a work permit abroad, if something goes badly they are still under protection of the US government, etc.
This is due to the fact that USA are the most powerful country on Earth, and one of the reasons for that is its military power, which is very expensive.
So the US citizen residing somewhere else would still have to pay their share to be protected by their country.
Not saying that I completely agree but I think it's a valid reason.
> I think the reason is that a US citizen has more privileges than someone else
Not the case. I have read that the most powerful passport in the world (as in, getting into countries visa free) is the British passport.
Additionally Americans, unlike citizens of other countries, get no protection from their host government. If they get evacuated from a disaster zone they get charged for the costs. And as everything the US Gov does is horrendously price inflated, there are cases of people getting "rescued" and then wishing they'd been left behind after being served with massive bills.
The way the USA taxes citizens abroad is indefensible. There's literally not one single defence for it.
(btw: there are two different Mike Hearn's posting in this thread! I am the other one)
Not the case. I have read that the most powerful passport in the world (as in, getting into countries visa free) is the British passport.
Additionally Americans, unlike citizens of other countries, get no protection from their host government. If they get evacuated from a disaster zone they get charged for the costs. And as everything the US Gov does is horrendously price inflated, there are cases of people getting "rescued" and then wishing they'd been left behind after being served with massive bills.
The way the USA taxes citizens abroad is indefensible. There's literally not one single defence for it.
(btw: there are two different Mike Hearn's posting in this thread! I am the other one)
> If they get evacuated from a disaster zone they get charged for the costs. And as everything the US Gov does is horrendously price inflated, there are cases of people getting "rescued" and then wishing they'd been left behind after being served with massive bills.
Citation please? The only thing I've ever heard of even remotely close to this ate the occasional local search and rescue operations that are caused by poor judgement. That has nothing at all to do with the U.S. government.
The next time there's a disaster in almost any country - look around. That's a U.S. Navy carrier providing electricity for emergency relief. Those are U.S. Marines distributing rice, ponchos, and water. Those are U.S. Navy Corpsmen delivering first aid to the wounded.
As bad as people like to make this country out to be, we are the first ones there with the biggest shovel any time another country needs to be dug out.
Citation please? The only thing I've ever heard of even remotely close to this ate the occasional local search and rescue operations that are caused by poor judgement. That has nothing at all to do with the U.S. government.
The next time there's a disaster in almost any country - look around. That's a U.S. Navy carrier providing electricity for emergency relief. Those are U.S. Marines distributing rice, ponchos, and water. Those are U.S. Navy Corpsmen delivering first aid to the wounded.
As bad as people like to make this country out to be, we are the first ones there with the biggest shovel any time another country needs to be dug out.
http://travel.state.gov/content/passports/english/emergencie...
Click the "Will the U.S. government pay for my travel? How much will it cost?" section.
As bad as people like to make this country out to be, we are the first ones there with the biggest shovel any time another country needs to be dug out.
It's not so. Go look at Yemen. The Chinese, Indians and Pakistanis evac'd their citizens when the war started. The USA left theirs to rot.
http://www.theguardian.com/world/2015/apr/01/american-civili...
Click the "Will the U.S. government pay for my travel? How much will it cost?" section.
As bad as people like to make this country out to be, we are the first ones there with the biggest shovel any time another country needs to be dug out.
It's not so. Go look at Yemen. The Chinese, Indians and Pakistanis evac'd their citizens when the war started. The USA left theirs to rot.
http://www.theguardian.com/world/2015/apr/01/american-civili...
"it would need to pay taxes on the cash it is holding outside the US"
Oh, the horror.
Oh, the horror.
They would not - paying their artists is a deductible business expense.
I believe what the grandparent meant is that bringing the money in to the US will require taxing it.
That article discusses buybacks and dividends.
Buybacks and dividends are post-tax expenses.
Paying royalties is an expense that comes before taxes. If they bring $500MM over and pay it as royalties, they would pay no taxes on it.
Buybacks and dividends are post-tax expenses.
Paying royalties is an expense that comes before taxes. If they bring $500MM over and pay it as royalties, they would pay no taxes on it.
Would they have to pay taxes all of the overseas earnings if they use just some of it? I figured they only paid tax on what they actually bring back here.
No, just what they repatriate. But they already have $22 BILLION in cash in the U.S., and they can borrow more for far less than their income tax rate, so why incur even a little tax?
The only reason for them to be concerned, is they've accumulated a vast amount of debt in a very short amount of time, all to put off dealing with the cash / tax problem.
That debt starts to add up, even when you're paying record low interest rates on it. Right now they're losing a billion a year just in interest on their debt, that's up from nothing three years ago. At the rate they're taking on debt, they'll be losing two billion dollars per year to interest within another two years. That starts to become a lot of money to be pissing away just on interest, all to avoid taxes. Over time it'll become a net larger sum than they would have paid in taxes on the cash.
That debt starts to add up, even when you're paying record low interest rates on it. Right now they're losing a billion a year just in interest on their debt, that's up from nothing three years ago. At the rate they're taking on debt, they'll be losing two billion dollars per year to interest within another two years. That starts to become a lot of money to be pissing away just on interest, all to avoid taxes. Over time it'll become a net larger sum than they would have paid in taxes on the cash.
It's not just about avoiding taxes. Bond rates are extremely low. If one believes rates will soon start to go up, taking on fixed rate debt can be a smart thing. As rates rise, the cash lying around can be used to generate returns above the rate on the debt. The tax angle makes it a double win.
> it seems like Apple may not actually have the cash to do this
Maybe they could do a Kickstarter campaign?
Maybe they could do a Kickstarter campaign?
Not defending apple for not paying artists, but I will defend their 'weaseling' out of US taxes. U.S. Corporate taxes are among the highest in the world and until Washington starts lowering their confiscatory tax rates, I would encourage all businesses to avoid repatriating earnings. A 10% tax rate is high enough.
US taxes contribute more to violent deaths and unnecessary punishments/imprisonments per dollar than taxes paid in most other countries. The US spends a greater proportion of GDP on "defense" than almost all other Western countries, so a tax dollar paid in the US is more likely to contribute to "defense" and less likely to contribute to education, healthcare or whatnot than a tax dollar paid in e.g. Sweden or Holland. Similarly, the US has 25% of the world's prison population yet only 5% of its total population, so necessarily spends a relatively higher percentage of tax dollars on incarceration.
There are actually people who do everything they can to minimise their tax liability in order to reduce the money spent on things they consider unjust: https://en.wikipedia.org/wiki/Tax_resistance.
Every dollar not paid in US tax is a dollar that won't contribute to blowing up people in the Middle East who have the misfortune of being in proximity to suspected terrorists (tens of thousands of people over the past decade) [1]. Similarly, every dollar not paid in US tax is a dollar that won't be spent putting poor people in prison for smoking a weed that causes less violence in a decade than alcohol causes in a day.
https://en.wikipedia.org/wiki/Civilian_casualties_in_the_war...
There are actually people who do everything they can to minimise their tax liability in order to reduce the money spent on things they consider unjust: https://en.wikipedia.org/wiki/Tax_resistance.
Every dollar not paid in US tax is a dollar that won't contribute to blowing up people in the Middle East who have the misfortune of being in proximity to suspected terrorists (tens of thousands of people over the past decade) [1]. Similarly, every dollar not paid in US tax is a dollar that won't be spent putting poor people in prison for smoking a weed that causes less violence in a decade than alcohol causes in a day.
https://en.wikipedia.org/wiki/Civilian_casualties_in_the_war...
I hope the people who are avoiding tax are donating their avoided taxes to their local schools and hospitals.
Where is the western world has lower tax rates than the US?
Edit: answered above.
Edit: answered above.
I was curious and looked up this claim. Turns out PolitiFact looked into it: http://www.politifact.com/punditfact/statements/2014/sep/09/...
The conclusion:
The conclusion:
Bolling said the United States has "the highest corporate tax rate in the free
world." He was referring to the statutory rate, meaning the rate before
deductions. On that score, he’s right: The United States does have the highest
statutory rate among developed countries. However, the United States’ corporate
tax rate doesn’t appear to be the highest once deductions and other exclusions
are taken into account.
The US effective corporate tax rate tends to be 25% to 27% in normal times, which is still one of the highest effective tax rates in the world. The median S&P 500 effective tax rate is 30%, also one of the highest rates in the world.
You often see 12% or 13% bandied about as the effective rate, but that's intentional intellectual fraud: they refer to 2010 numbers, when the US was coming out of the great recession and corporations had lost a ton of money.
You often see 12% or 13% bandied about as the effective rate, but that's intentional intellectual fraud: they refer to 2010 numbers, when the US was coming out of the great recession and corporations had lost a ton of money.
There's also some countries that have relatively "low tax rate" but very high social security costs which are not always counted as tax rates by studies.
And not all those costs can be credited against US taxes on repatriation, so double taxation scenarios exist.
[deleted]
[deleted]
I agree with corporations who attempt to legally pay as little taxes as possible. That's what I do. If someone doesn't like it, then get the laws changed.
Yeah, why dont the poor and downtrodden just pay their lobbyists to change the law of the land... what?
The corporations have the money and the drive to get the laws changed, who else does?
The corporations have the money and the drive to get the laws changed, who else does?
I was hoping someone would start a popular kickstarter style site for this.
It seems pretty simple to me. If you want your laws changed, pool your money and go lobby the gov't just like every other corporation.
It seems pretty simple to me. If you want your laws changed, pool your money and go lobby the gov't just like every other corporation.
That exists: Mayday PAC. Lawrence Lessig organized it last year. They raised $11 million and tried to influence some key Congressional races, but it didn't really work. Now they're trying some different things:
https://medium.com/@lessig/we-tried-we-learned-we-re-trying-...
https://medium.com/@lessig/we-tried-we-learned-we-re-trying-...
Interesting link, but $11 million bucks is probably not enough to buy even a single Senator, even if his district is an extremely cheap media market.
A recent Senate campaign in one of the nation's cheapest media markets (Jon Tester's) was run for ~15 million bucks[0] in coordinated campaign funds, plus probably-larger undisclosed amounts of "independent" campaign funding through PAC's etc.
In the same cheap media market, Senator Max Baucus raised >$5 million[1] for the coordinated campaign in his final Senate race, in which he ran effectively unopposed. Again this $5 million does not account for his pre-existing war chest from thirty five years of Senate campaigns or the (vastly larger) fundraising of his GlacierPAC or other related "independent" political organizations.
So the minimum single-senator campaign cost is probably somewhere between those two bounds. Therefore I don't regard the core idea of Mayday PAC as a failure; instead it seems like they need to scale it before we can decide if it's workable.
[0] http://www.opensecrets.org/politicians/summary.php?cid=n0002...
[1] http://www.opensecrets.org/politicians/summary.php?cid=n0000...
A recent Senate campaign in one of the nation's cheapest media markets (Jon Tester's) was run for ~15 million bucks[0] in coordinated campaign funds, plus probably-larger undisclosed amounts of "independent" campaign funding through PAC's etc.
In the same cheap media market, Senator Max Baucus raised >$5 million[1] for the coordinated campaign in his final Senate race, in which he ran effectively unopposed. Again this $5 million does not account for his pre-existing war chest from thirty five years of Senate campaigns or the (vastly larger) fundraising of his GlacierPAC or other related "independent" political organizations.
So the minimum single-senator campaign cost is probably somewhere between those two bounds. Therefore I don't regard the core idea of Mayday PAC as a failure; instead it seems like they need to scale it before we can decide if it's workable.
[0] http://www.opensecrets.org/politicians/summary.php?cid=n0002...
[1] http://www.opensecrets.org/politicians/summary.php?cid=n0000...
Yeah! None of this one-man-one-vote crap, back to some good old fashioned plutocracy. After all if the top 10-20% own 90% of the wealth, it's only right and proper that they also own an equivalent share of the political power. ;-)
Nobody said it was right, just that it's less bad than having just the rich lobbying.
Do you play board games?
Any rule set can be gamed / broken.
To keep the game going, sometimes players just need to do the right thing, thereby honoring other player's investment in the game.
And law is so much more complicated than a board game.
https://en.wikipedia.org/wiki/Gödel%27s_incompleteness_theor...
Any rule set can be gamed / broken.
To keep the game going, sometimes players just need to do the right thing, thereby honoring other player's investment in the game.
And law is so much more complicated than a board game.
https://en.wikipedia.org/wiki/Gödel%27s_incompleteness_theor...
Changing the laws requires a sizable investment in lobbyists and bribe money before any ROI can be achieved. Most individuals simply don't have enough taxable income to make the investment worthwhile. Megacorps do. The situation is not morally symmetrical and not practically symmetrical.
How come 10% is high enough for corporations but I pay a lot more than that in income taxes. Shouldn't it be the other way around?
I think it could be either way, but many object to the fact that it is both. In other words, corporate tax is seen as double taxation, since the earnings (after taxes) are then passed on to shareholders, who pay tax on it again.
I could see a coherent tax code that taxes corporations, but not individuals, or one that taxed individuals, but not corporations (Of course with either of these there would no doubt be all sorts of new loopholes to deal with). But taxing both seems odd to me.
I could see a coherent tax code that taxes corporations, but not individuals, or one that taxed individuals, but not corporations (Of course with either of these there would no doubt be all sorts of new loopholes to deal with). But taxing both seems odd to me.
I'm not sure how the tax system works in the US, but I was just talking to my accountant about this issue the other day.
In Australia, my company gets taxed at a flat 30% on all profits in a year. If I want to take cash out of the company after that tax has been taken, I pay "top-up" tax that brings the total tax paid to the level of my income tax rate.
For example, if the company earned $10000, after all expenses, then it would pay $3000 in tax, leaving $7000 left that I can take out. If I earned no money in the year, my income tax rate is 0%, so the top-up tax is -$3000 (I.e. I get a tax refund for $3000). If I earned $50000 in the year, then my income tax rate is 32.5%, so I would have to pay top-up tax of $250 (I.e. 2.5% of the original $10000, which has already been taxed 30%).
Double taxation shouldn't happen, and while my company was set up for tax minimisation purposes, international corporations are able to do an insane level of fuckery to avoid almost all taxation.
In Australia, my company gets taxed at a flat 30% on all profits in a year. If I want to take cash out of the company after that tax has been taken, I pay "top-up" tax that brings the total tax paid to the level of my income tax rate.
For example, if the company earned $10000, after all expenses, then it would pay $3000 in tax, leaving $7000 left that I can take out. If I earned no money in the year, my income tax rate is 0%, so the top-up tax is -$3000 (I.e. I get a tax refund for $3000). If I earned $50000 in the year, then my income tax rate is 32.5%, so I would have to pay top-up tax of $250 (I.e. 2.5% of the original $10000, which has already been taxed 30%).
Double taxation shouldn't happen, and while my company was set up for tax minimisation purposes, international corporations are able to do an insane level of fuckery to avoid almost all taxation.
Isn't double taxation really a choice that the owners make? I.e. an unlimited liability company wouldn't be taxed twice. In essence, corporate tax is a fee for the legal protection given by a corporation/limited liability entity.
By the double tax hypothesis, how come then I have to pay sales tax on things I buy using money I earned from income that's already been taxed.
It's only considered "double taxation" when the tax hits wealthy people[1]
1: http://assets.amuniversal.com/921b06d016420130ff2c001dd8b71c...
1: http://assets.amuniversal.com/921b06d016420130ff2c001dd8b71c...
Sales taxes are deductible in the US, sort of. You can deduct either state and local sales taxes or state and local income taxes. No idea what the rationale for that is, but if you live in a State with no or very low income tax and deduct your sales taxes, it's kind of like you're not getting taxed twice.
http://www.irs.gov/Individuals/Sales-Tax-Deduction-Calculato...
http://www.irs.gov/Individuals/Sales-Tax-Deduction-Calculato...
If there are loopholes allowing corporations to not actually pay their taxes and the capital gains tax rate is a fraction of the income tax rate, is it really fair to call it double taxation?
Corporations are just a straw man. Any profit that a corporation makes is either held as cash, reinvested by the corporation, or returned to the owners of the corporation (i.e. shareholders) as dividends. The profit that's held and reinvested is intended to generate even more profits in the future, which means that eventually, all of a company's profit makes its way back to individual shareholders. Those shareholders, in turn, pay income tax on those dividends. So a corporation's profit is already taxed at the point where it performs the intended purpose of corporate profits--to provide income to the shareholders.
Taxing corporate profits directly at all only accomplishes the following things:
* The profits that are redistributed to shareholders end up being double-taxed; the corporation pays tax on them, and then distributes them to shareholders who pay income tax on them.
* The profits that are reinvested end up being taxed, which reduces the amount that the corporation can reinvest. This directly reduces economic activity, since reinvestment often manifests itself in things like hiring and construction; in other words, increased economic activity. In practice, it might be possible to avoid taxes on these reinvestment activities by accounting for them as expenses and saying, "I guess we didn't make any profit this quarter".
* The profits that are held as cash are taxed, and this isn't actually as big of a deal unless the company is building up a massive stockpile to reinvest later, but in this case it would be fairer to just tax a corporation's cash holdings directly. This would also incentivize corporations to either reinvest their profits or distribute them as dividends, either of which is better for the economy as a whole.
Taxing corporate profits directly at all only accomplishes the following things:
* The profits that are redistributed to shareholders end up being double-taxed; the corporation pays tax on them, and then distributes them to shareholders who pay income tax on them.
* The profits that are reinvested end up being taxed, which reduces the amount that the corporation can reinvest. This directly reduces economic activity, since reinvestment often manifests itself in things like hiring and construction; in other words, increased economic activity. In practice, it might be possible to avoid taxes on these reinvestment activities by accounting for them as expenses and saying, "I guess we didn't make any profit this quarter".
* The profits that are held as cash are taxed, and this isn't actually as big of a deal unless the company is building up a massive stockpile to reinvest later, but in this case it would be fairer to just tax a corporation's cash holdings directly. This would also incentivize corporations to either reinvest their profits or distribute them as dividends, either of which is better for the economy as a whole.
Nice usage of the word 'confiscatory'. My experience with people who use this word in relation to taxation is that they use it in derogatory sense and is used primarily by conservatives and libertarians. I don't know if that is the case for you. What do you consider the optimal corporate tax rate? You said 10% is high enough. Do you think it should be 0%?
If you are in the libertarian and/or conservative branch of U.S. politics why do you look to other countries' tax rates for guidance on what our tax rates ought to be? I have been under the impression that looking to other countries for guidance on our social policy is bad and contrary to the notion of exceptionalism.
The U.S. uniquely, I believe, considers corporations persons. Hence the Citizens United decision. Given this shouldn't the tax rate on these citizens be the same as on other citizens with like earnings?
If you are in the libertarian and/or conservative branch of U.S. politics why do you look to other countries' tax rates for guidance on what our tax rates ought to be? I have been under the impression that looking to other countries for guidance on our social policy is bad and contrary to the notion of exceptionalism.
The U.S. uniquely, I believe, considers corporations persons. Hence the Citizens United decision. Given this shouldn't the tax rate on these citizens be the same as on other citizens with like earnings?
There is no sense setting up a strawman about a topic, exceptionalism, which the parent did not even raise or mention.
Blaming Citizens United (certainly a harmful decision) on corporate personhood is, while popular, unduly reductive; the actual ruling was more about freedom of association. Even in the context of the debate about corporate personhood, your rhetorical question about tax rate is pure demagogy.
Blaming Citizens United (certainly a harmful decision) on corporate personhood is, while popular, unduly reductive; the actual ruling was more about freedom of association. Even in the context of the debate about corporate personhood, your rhetorical question about tax rate is pure demagogy.
Have you ever heard of someone refer to taxes as confiscatory and it be the case that that person is not a conservative or a libertarian who holds the beliefs mention in my post? I haven't but I did acknowledge that perhaps those beliefs were not shared by the person I responded to. Thus the questions I asked. It was not demagoguery. The argument was quite rational.
People who refer to taxes as confiscatory rather than as being too high are attempting to frame the topic of taxation as it being, necessarily, wrong. It's a ridiculous starting point. These same people almost always scoff at arguments that the U.S. ought to adopt some social policies because all other industrialized nations have them. It is, with this fact in mind, quite rational to ask why looking at the corporate tax rate of other countries is a good argument.
Why is it demagoguery to ask why a person in the form of a corporation should pay less in taxes than a person in the form of a human?
People who refer to taxes as confiscatory rather than as being too high are attempting to frame the topic of taxation as it being, necessarily, wrong. It's a ridiculous starting point. These same people almost always scoff at arguments that the U.S. ought to adopt some social policies because all other industrialized nations have them. It is, with this fact in mind, quite rational to ask why looking at the corporate tax rate of other countries is a good argument.
Why is it demagoguery to ask why a person in the form of a corporation should pay less in taxes than a person in the form of a human?
I appreciate you responding to my criticism. The first part - there is definitely an association between believing A and believing B, but I don't think it's fair to assume B when they only talked about A.
As for what I called demagoguery: I mean, corporations are considered legal persons in most countries - that's where the word corporation comes from - which is what allows them to own property, enter into contracts, etc., as well as to violate the law. So then the US has been more uniquely inclined to allow corporations to claim rights originally intended for natural persons (such as free speech, contract rights, property rights, rights of the accused); and there is valid criticism of that idea for various reasons, the most obvious one being that they're very different from actual people, so Congress should have to explicitly decide what privileges corporations should have rather than the judicial system tacking on existing ones. But on the other hand, it's not completely ridiculous to say that since corporations and people have similar sets of abilities in the eyes of the law, the same principles should apply, especially with respect to commerce.
Even in the case of corporate free speech, there are certainly situations where governmental restrictions on a corporation's speech would feel fundamentally wrong - e.g. suppose Congress decided political activism groups, from the EFF to the NRA, were only allowed to use corporate funds to spread their message at all if Congress liked them. Citizens United, as I said, approached this in terms of freedom of association more than corporate personhood, but neither does it seem immediately absurd to try to solve it the latter way. (Incidentally, the need to find, and the partial arbitrariness of, a dividing line between that example on one hand which should have constitutional protection, and super PACs on the other which should not, is why "corporations aren't people" is a bit simplistic as an approach to solving the Citizens United problem. You really don't want to remove protection from the former.)
Anyway, it seems self-evident that corporations and individuals need at least somewhat separate treatment by tax law (e.g. because of the double taxation issue when corporations pay out earnings to shareholders). Given that corporate personhood in general is not fundamentally and irrevocably an evil or unfair idea, merely specific implementations of it, it's not fair to be reductive and say that the person analogy must be taken to absurd extremes.
As for what I called demagoguery: I mean, corporations are considered legal persons in most countries - that's where the word corporation comes from - which is what allows them to own property, enter into contracts, etc., as well as to violate the law. So then the US has been more uniquely inclined to allow corporations to claim rights originally intended for natural persons (such as free speech, contract rights, property rights, rights of the accused); and there is valid criticism of that idea for various reasons, the most obvious one being that they're very different from actual people, so Congress should have to explicitly decide what privileges corporations should have rather than the judicial system tacking on existing ones. But on the other hand, it's not completely ridiculous to say that since corporations and people have similar sets of abilities in the eyes of the law, the same principles should apply, especially with respect to commerce.
Even in the case of corporate free speech, there are certainly situations where governmental restrictions on a corporation's speech would feel fundamentally wrong - e.g. suppose Congress decided political activism groups, from the EFF to the NRA, were only allowed to use corporate funds to spread their message at all if Congress liked them. Citizens United, as I said, approached this in terms of freedom of association more than corporate personhood, but neither does it seem immediately absurd to try to solve it the latter way. (Incidentally, the need to find, and the partial arbitrariness of, a dividing line between that example on one hand which should have constitutional protection, and super PACs on the other which should not, is why "corporations aren't people" is a bit simplistic as an approach to solving the Citizens United problem. You really don't want to remove protection from the former.)
Anyway, it seems self-evident that corporations and individuals need at least somewhat separate treatment by tax law (e.g. because of the double taxation issue when corporations pay out earnings to shareholders). Given that corporate personhood in general is not fundamentally and irrevocably an evil or unfair idea, merely specific implementations of it, it's not fair to be reductive and say that the person analogy must be taken to absurd extremes.
I think in some ways, you have a fiduciary responsibility to your shareholders to use reasonable means to maximize the value of your company. It seems to me that includes both operational efficiency and prudent use of available tax breaks.
I'm uncomfortable with the line of reasoning that we "can't do anything until we change the system," but I do wonder how Wall Street would react to a company that decided for moral reasons to avoid the schemes and pay more taxes.
I'm uncomfortable with the line of reasoning that we "can't do anything until we change the system," but I do wonder how Wall Street would react to a company that decided for moral reasons to avoid the schemes and pay more taxes.
Except you actually don't and this has been a myth that has continued to plague any type of discussions like this.
The other rationale I've heard is that if Apple paid for it out-of-pocket it could be considered anticompetitive for using predatory pricing.
This circumstance, in which Apple essentially pre-installs the service on every device and subsequently offers it for free, isn't so different from 1990s Microsoft bundling IE with Windows to undercut Netscape.
This circumstance, in which Apple essentially pre-installs the service on every device and subsequently offers it for free, isn't so different from 1990s Microsoft bundling IE with Windows to undercut Netscape.
It's not content producers, it's content right holders. Presumably they entered into this deal freely.
Is this a dick move from Apple? Sure. But the day I'll be arguing on behalf of music labels and distributors is the day the hell freezes over. Their situation is entirely of their own making.
Is this a dick move from Apple? Sure. But the day I'll be arguing on behalf of music labels and distributors is the day the hell freezes over. Their situation is entirely of their own making.
> just not paying the content producers
Someone somewhere invested an absolute shit-ton of cash in getting Ms Swift famous, producing her records, promoting her concerts, payola, etc, with absolutely no promise of return.
I agree and it seems unreasonable of Apple. To me it conveys that they don't value the content musicians bring.
Are there even any artists that agree to this?
The first three months of Apple Music will essentially be “free music from artists who would give away their music for free”.
Taylor Swift is signed to Big Machine Records (BMLG). Big Machine Records is distributed by Universal Music Group (UMG). I am sure BMLG/UMG received a sizable advance from Apple in exchange for streaming rights for their master recordings. UMG probably negotiated an even higher advance in exchange for permission to launch the 3 month free campaign. UMG / BMLG should be sharing this advance payment with their artists. Taylor knows this so a good question to ask is: What % of the advance is Taylor receiving? The answer is probably none because most artists receive nothing from these advance payments. Even the hugely successful ones. So why is Taylor writing this letter? She is extremely smart and has a brilliant team of advisors around her so she knows about the advance that Apple already paid UMG. While posting this letter fits into the general discourse regarding underpayments to artists from streaming services, behind the scenes she is likely negotiating her own, separate, significant advance from Apple. I would do the same if I were her.
I suspect her ability to refuse apple the right to stream her album is also a product of her success. I doubt smaller artists have that right in their agreements.
Yep, that's what it looks like.
And why do we not hear about the other huge artists? (rhetorical question)
Presumably, the labels are responsible, not Apple. Apple represents Apple's interests, while the labels are supposed to represent the artists'. Though in practice, the labels probably represent their own.
So, presumably, the labels have decided that offering their content for free to Apple for 3 months will result in more revenue in the future, just as Apple has. Surely any artist understands the idea of giving away their music in order to build a paying fan base in the future.
Ultimately, any artists who lose a significant chunk of income due to these 3-month trials and never see increased income after the trials should be upset with their label's failure to represent them well.
Then again, isn't that to be expected as an artist? Your label encourages you to give CDs away, or tour at a loss, and sometimes it pays off and sometimes it doesn't? Isn't this the same idea? It sounds to me like a worthwhile risk. How many people were going to buy your debut album or come see a show and choose not to because they used their iTunes streaming account? Versus how many people easily stream (and pay for) you music 3 months later because they got hooked on iTunes streaming?
So, presumably, the labels have decided that offering their content for free to Apple for 3 months will result in more revenue in the future, just as Apple has. Surely any artist understands the idea of giving away their music in order to build a paying fan base in the future.
Ultimately, any artists who lose a significant chunk of income due to these 3-month trials and never see increased income after the trials should be upset with their label's failure to represent them well.
Then again, isn't that to be expected as an artist? Your label encourages you to give CDs away, or tour at a loss, and sometimes it pays off and sometimes it doesn't? Isn't this the same idea? It sounds to me like a worthwhile risk. How many people were going to buy your debut album or come see a show and choose not to because they used their iTunes streaming account? Versus how many people easily stream (and pay for) you music 3 months later because they got hooked on iTunes streaming?
The problem here is that there's more than one label. Well, that's one problem. But the larger labels are more readily able to absorb this kind of hit than the smaller ones.
Another problem is Apple is threatening removal from the iTunes music store for nonparticipants. So it's not just that labels think they can make more money in the future if they agree, Apple is threatening to cut off their sales right now if they don't agree.
Another problem is that this is the same Apple that is pressuring record labels to cut off the free tier on Spotify, which labels get compensated for at the same rate as paid streams, because it "devalues the music." As if this doesn't.
Apple has a dominant market position in high-end smartphones (they make 90% of all smartphone profits) and they are using this to leverage other markets in ways that make Steve Ballmer look like Winnie the Pooh. They already tried to engage in ebook price fixing, now they are trying to bully Spotify out of existence.
Another problem is Apple is threatening removal from the iTunes music store for nonparticipants. So it's not just that labels think they can make more money in the future if they agree, Apple is threatening to cut off their sales right now if they don't agree.
Another problem is that this is the same Apple that is pressuring record labels to cut off the free tier on Spotify, which labels get compensated for at the same rate as paid streams, because it "devalues the music." As if this doesn't.
Apple has a dominant market position in high-end smartphones (they make 90% of all smartphone profits) and they are using this to leverage other markets in ways that make Steve Ballmer look like Winnie the Pooh. They already tried to engage in ebook price fixing, now they are trying to bully Spotify out of existence.
To my knowledge, the only claim that Apple is threatening to remove music from purchase comes from this one guy ranting on Twitter and it was specifically denied by Apple. Doesn't mean Apple's telling the truth, of course, but it seems likely that Newcombe didn't have a full grasp of the situation. http://consequenceofsound.net/2015/06/report-apple-threatens...
In 215 comments no one that I could find has mentioned that, while well-intentioned, this post comes off as somewhat disingenuous because Apple does not deal directly with the artists. The entire (pretty well-written) thing doesn't mention _at all_ that the majority of musicians do not deal directly with distributors. Think about it: how are Apple/Google/Spotify/Amazon going to deal directly with 10 million individuals? The answer is that they don't.
I think anyone can agree that Apple is being shitty by not paying for something they're making money on, the people who are directly responsible for not compensating the artists are, rather conspicuously, left out of this rant.
I think anyone can agree that Apple is being shitty by not paying for something they're making money on, the people who are directly responsible for not compensating the artists are, rather conspicuously, left out of this rant.
Exactly. And my question is forget the digital part of it. How did this work in the days of records and CDs when promotional copies were given away? Sure most went to radio stations for airplay, but others were given away. Did the artist get any money for those copies or was that part of the record companies' marketing budget?
The artists paid for those copies themselves when they paid back the record companies for marketing.
> Apple is being shitty by not paying for something they're making money on
How are they making money on the free trial, during the trial?
How are they making money on the free trial, during the trial?
(1) subscriber acquisition and (2) neutralising the competition.
AOL for example printed and gave away for free, millions of CDs with free dialup access, spending as much as $35 on SAC (Subscriber Acquisition Cost) [1]:
AOL for example printed and gave away for free, millions of CDs with free dialup access, spending as much as $35 on SAC (Subscriber Acquisition Cost) [1]:
> How much did it cost AOL to distribute all those CDs back in the 1990s?
>
> Steve Case, co-founder and former chief executive officer and chairman of America Online:
>
> At that time I believe the average subscriber life was about 25 months and revenue was about $350 so we spent about $35 to acquire subscribers. As we were able to lower the cost of disks/trial/etc we were able to ramp up marketing. (Plus, we knew Microsoft was coming and it was never going to be easier or cheaper to get market share.) When we went public in 1992 we had less than 200,000 subscribers; a decade later the number was in the 25 million range. That helped drive our market capitalization up from $70 million at the time of the IPO to $150 billion when we decided to combine with Time Warner to accelerate our transition to broadband and diversify our revenue mix.
[1]: http://www.quora.com/How-much-did-it-cost-AOL-to-distribute-all-those-CDs-back-in-the-1990s>I think anyone can agree that Apple is being shitty by not paying for something they're making money on
Apple AND the music industry are losing money during the 3 months, but they both stand to gain money after that. Apple has invested a lot of money in creating the service and running it for free for the trial period.
Apple AND the music industry are losing money during the 3 months, but they both stand to gain money after that. Apple has invested a lot of money in creating the service and running it for free for the trial period.
They are making artists pay for their user acquisition. I still call that profiting off of someone else's work without compensating them.
I like how she states her position so concisely in the last two lines:
We don’t ask you for free iPhones. Please don’t ask us to provide you with our music for no compensation.
We don’t ask you for free iPhones. Please don’t ask us to provide you with our music for no compensation.
It's the weakest part of her argument though as iPhones have a unit cost whereas digital copies of her music do not.
But I think she is very right to refuse to pay for a scheme that is supposed to increase Apple's market share and not hers.
But I think she is very right to refuse to pay for a scheme that is supposed to increase Apple's market share and not hers.
>It's the weakest part of her argument though as iPhones have a unit cost whereas digital copies of her music do not.
The most basic cost you have to recoup is that of making the song (studio, musicians, production, what you charge for your voice etc). This remains real money, even if you can make a digital copy of a song for free.
Besides this is based on a "physical product" model of economics and tries to apply it to digital goods. It doesn't relate that well. In an era when tons of people works in stuff that can be "copied for free", there are other models that should be applied (e.g. that you should still pay for the free-to-produce copy).
The most basic cost you have to recoup is that of making the song (studio, musicians, production, what you charge for your voice etc). This remains real money, even if you can make a digital copy of a song for free.
Besides this is based on a "physical product" model of economics and tries to apply it to digital goods. It doesn't relate that well. In an era when tons of people works in stuff that can be "copied for free", there are other models that should be applied (e.g. that you should still pay for the free-to-produce copy).
>The most basic cost you have to recoup is that of making the song (studio, musicians, production, what you charge for your voice etc). This remains real money, even if you can make a digital copy of a song for free.
Absolutely, but that is fixed cost not unit cost. Not recouping fixed costs is bad. But losing money on top of that for every unit you give away is even worse.
The distinction matters just as much as in the past because our economies have not just become more digital, they are also more service oriented than before, and services often do have unit costs. A better analogy to giving away iPhones would be to play a live gig for free.
Absolutely, but that is fixed cost not unit cost. Not recouping fixed costs is bad. But losing money on top of that for every unit you give away is even worse.
The distinction matters just as much as in the past because our economies have not just become more digital, they are also more service oriented than before, and services often do have unit costs. A better analogy to giving away iPhones would be to play a live gig for free.
> Absolutely, but that is fixed cost not unit cost.
Isn't your unit cost = Cost of Goods Sold / Units Sold?
Wouldn't the fixed cost producing the music be amortized (over some arbitrary number of years) into the Cost of Goods Sold to produce an accurate picture of unit cost?
> A better analogy to giving away iPhones would be to play a live gig for free.
Or how about this analogy: 3 months of free wireless service with every iPhone?
Isn't your unit cost = Cost of Goods Sold / Units Sold?
Wouldn't the fixed cost producing the music be amortized (over some arbitrary number of years) into the Cost of Goods Sold to produce an accurate picture of unit cost?
> A better analogy to giving away iPhones would be to play a live gig for free.
Or how about this analogy: 3 months of free wireless service with every iPhone?
Whatever you may call it, I think the distinction between fixed cost and whatever each unit costs you on top of that is very important when we're talking freebies. The correct term is probably marginal cost.
That really depends. If you recover your fixed costs, sure.
What to the top artists represent in terms of percentage of sales? It's probably more than 90 percent of the sales from less than 10% of the artists. For them, your argument is probably true.
I would imagine it takes significantly longer for independent artists, especially niche artists, to recover their fixed costs, especially since music sales are basically a popularity contest.
What to the top artists represent in terms of percentage of sales? It's probably more than 90 percent of the sales from less than 10% of the artists. For them, your argument is probably true.
I would imagine it takes significantly longer for independent artists, especially niche artists, to recover their fixed costs, especially since music sales are basically a popularity contest.
Does the cost matter? Both the iPhone and Music have value regardless of cost.
Does anyone know how other companies like Spotify, Rhapsody, Google play and others treat the trial period?
Does anyone know how other companies like Spotify, Rhapsody, Google play and others treat the trial period?
OK, give us iPhones for what it costs Apple to roll them off the factory floor please and thank you! (That's more than 50% off retail.)
Companies very often do sell products at or above cost when a line begins in order to gain market share, while the price to build them goes down over time and they become profitable. She has most certainly taken advantage of this at some point, without knowing it.
I found it a little off-putting, because Apple does provide free iPhones to celebrities. They're included in gift bags and freebie tents at most of the events they attend, or often just mailed to them directly free of charge, or sent with a check in exchange for a tweet, etc.
Taylor Swift has probably personally received more than a dozen free iPhones. Even lesser-known celebrities receive multiple copies of all the latest electronics, and just regift them because they have so many.
When she wanted to upgrade to the 6, she most likely did not go to the store and pay for it.
Celebrities that big just receive free stuff shipped to their front door all the time. TVs, electronics, clothes, jewelry, luxury brands.
Taylor Swift has probably personally received more than a dozen free iPhones. Even lesser-known celebrities receive multiple copies of all the latest electronics, and just regift them because they have so many.
When she wanted to upgrade to the 6, she most likely did not go to the store and pay for it.
Celebrities that big just receive free stuff shipped to their front door all the time. TVs, electronics, clothes, jewelry, luxury brands.
Carriers who choose to offer 'free' iPhones are doing it for basically the same reason as the labels accepted this deal with Apple. They're willing to take a short term loss / risk in exchange for years of revenue from subscriptions.
They gove away their OS and a ton of solid near business class apps in some cases. They do this to get people to buy hardware.
She said she supports herself on tours, five more music away, you should get more people at her tours. Same for the new band, you don't get discovered on the radio, 5K and they will play your song, it's that easy. Never works.
Play shows for 5 - 10 years, you may make it, or be coached and molded like Taylor, that Canadian Kid, and the ret of them.
She said she supports herself on tours, five more music away, you should get more people at her tours. Same for the new band, you don't get discovered on the radio, 5K and they will play your song, it's that easy. Never works.
Play shows for 5 - 10 years, you may make it, or be coached and molded like Taylor, that Canadian Kid, and the ret of them.
Can I use their OS or apps on anything I don't buy from them first? Apple doesn't "give away" anything for free.
Lots of record labels (mostly independents) are definitely unhappy with this as well. The biggest one to speak out is beggars group[1].
[1] https://news.ycombinator.com/item?id=9738304
[1] https://news.ycombinator.com/item?id=9738304
I'll suggest this is all a fairly straightforward negotiation ploy.
Apple's deal obviously makes sense for the artist otherwise the major labels would not have signed up, full stop.
What then are these independent's doing? I'd suggest since there is no money at stake in the first 3 months they are holding out to pressure for slightly better terms (and a couple headlines never hurt sales) and then will jump on in 3 months once the money is actually flowing.
You'll note that there will always be many people in the 3 month free trial, Swift isn't threatening to hold her album out forever (or her other music!) to stop the supposed bad business model, just for the 3 launch months when guaranteed revenue zero.
Kudos to these artists for knowing where their leverage is and using it though!
Apple has a couple options:
(1) just eat it, prolly what happens.
(2) they can pay up a bit but the big labels would be steamed at getting a worse deal than independents so that isn't happening.
(3) pay everyone a little bit more for the launch months. This might happen but the clock is ticking.
(4) they can make these artists sit out longer than the initial 3 months. That compromises the quality of their service though. Still they might do it, hoping it would pressure them to signing up for the release.
(5) they could weight the streaming for awhile so that holdout artists appear less than they might normally. I expect this might happen but if they do this hopefully be done openly ("we're rewarding our launch partners").
(6) go back in time and do a 3 month beta rollout so money is at stake when you do the big rollout with the new phone.
Apple's deal obviously makes sense for the artist otherwise the major labels would not have signed up, full stop.
What then are these independent's doing? I'd suggest since there is no money at stake in the first 3 months they are holding out to pressure for slightly better terms (and a couple headlines never hurt sales) and then will jump on in 3 months once the money is actually flowing.
You'll note that there will always be many people in the 3 month free trial, Swift isn't threatening to hold her album out forever (or her other music!) to stop the supposed bad business model, just for the 3 launch months when guaranteed revenue zero.
Kudos to these artists for knowing where their leverage is and using it though!
Apple has a couple options:
(1) just eat it, prolly what happens.
(2) they can pay up a bit but the big labels would be steamed at getting a worse deal than independents so that isn't happening.
(3) pay everyone a little bit more for the launch months. This might happen but the clock is ticking.
(4) they can make these artists sit out longer than the initial 3 months. That compromises the quality of their service though. Still they might do it, hoping it would pressure them to signing up for the release.
(5) they could weight the streaming for awhile so that holdout artists appear less than they might normally. I expect this might happen but if they do this hopefully be done openly ("we're rewarding our launch partners").
(6) go back in time and do a 3 month beta rollout so money is at stake when you do the big rollout with the new phone.
What makes sense for the major labels doesn't necessarily make sense for the artist. Major labels have billions in net worth and have invested heavily in the stock/equity of companies such as Apple, Spotify etc etc. They could care less about the royalty pennies that drip out the bottom to feed the artists. They're getting rich on equity.
The independents on the other hand don't have this luxury.
The independents on the other hand don't have this luxury.
>> Apple's deal obviously makes sense for the artist otherwise the major labels would not have signed up, full stop.
What then are these independent's doing?
It's very simple. The biggest portion of a records sales are going to come int he month or two after release, after the big marketing push. If an indie releases a record during those 3 months they are going to lose a ton of potential revenue. For a small record label that can be terminal. They're running on fumes they can't take the hit like the majors.
It's very simple. The biggest portion of a records sales are going to come int he month or two after release, after the big marketing push. If an indie releases a record during those 3 months they are going to lose a ton of potential revenue. For a small record label that can be terminal. They're running on fumes they can't take the hit like the majors.
I think release in the window is a good point but the point of streaming services is to mitigate this by shifting a much larger percent of income to back catalog.
I also take issue with characterizing streaming income as a "ton of revenue" (perhaps you meant actual sales sales in which case somewhat irrelevent here?) while everything I've heard over the years is how streaming revenue is a small fraction of artist revenue, especially independents.
Here's numbers from a pro-spotify independent artist [1]:
$1,359 from spotify, that's apparently a career to date number.
http://www.popmatters.com/feature/193667-why-its-time-to-sto...
I also take issue with characterizing streaming income as a "ton of revenue" (perhaps you meant actual sales sales in which case somewhat irrelevent here?) while everything I've heard over the years is how streaming revenue is a small fraction of artist revenue, especially independents.
Here's numbers from a pro-spotify independent artist [1]:
$1,359 from spotify, that's apparently a career to date number.
http://www.popmatters.com/feature/193667-why-its-time-to-sto...
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This is very black and white. This is a great "business" move for apple, but morally reprehensible.
This is a big business asking the "little people" to work for free. Completely unfair.
This is a big business asking the "little people" to work for free. Completely unfair.
At the same time artists (especially indies) have a significant interest in Apple succeeding. If Spotify dominates the market to the exclusion of all others, they will have no pressure to keep artist revenue share competitive. Best case for artists is a multitude of streaming services all competing for the most appealing inventory.
There is the third option that rarely gets discussed. No subscription service succeeding in dominating the market entirely.
Alternatively, a two-track system, where subscription services are consistently behind on popular hits, and artists hit record services first.
Alternatively, a two-track system, where subscription services are consistently behind on popular hits, and artists hit record services first.
It was, until one of the biggest "little people" started writing on her tumblr how she would have none of it.
Suppose Apple were to instead finance their free trial by reducing the royalties they pay artists. Would this be morally reprehensible, since it would result in the "little people" losing as much revenue as they would have under the existing scheme? I don't see how it is immoral for a company to reduce the total amount that it pays to artists. Prices are set by negotiation/the market. I think people feel undue sympathy towards musicians because they are cool and beautiful people, and so people don't want the market to apply to them.
Well, in most situations, prices are set IN PART by the market. Usually common decency is involved as well (ie: the minimum wage).
I would argue that supporting the arts is important the same way that protecting minimum wage workers from abuse is (mandatory unpaid overtime, wage theft, etc).
I would argue that supporting the arts is important the same way that protecting minimum wage workers from abuse is (mandatory unpaid overtime, wage theft, etc).
There is a counterpoint to this whole thing, apple doesn't have a free tier, which is to the artists benefit.
It doesn't matter. Think about this for any other profession. This is the big business version of the craigslist ad asking a graphic designer to work for free "for the exposure".
They planned on the backlash too because they get free advertising from some big names in music...but they'll still move forward with the 3-month royalty-free period because most artists will simply roll over.
> I respect the company and the truly ingenious minds that have created a legacy based on innovation and pushing the right boundaries.
> ... just like the innovators and creators at Apple are pioneering in their field
> ... we admire and respect Apple so much.
> I think that is beautiful progress. We know how astronomically successful Apple has been...
> I say this with love, reverence, and admiration for everything else Apple has done.
Taylor's post reminds me strongly of this article by Eli Schiff:
"Wilcox's flattery is not accidental. It was essential that Wilcox mentioned his qualification as an Apple fanatic, because that is, of course, the pre-requisite for saying anything remotely unfavorable about Apple."
– https://news.ycombinator.com/item?id=9256014
> ... just like the innovators and creators at Apple are pioneering in their field
> ... we admire and respect Apple so much.
> I think that is beautiful progress. We know how astronomically successful Apple has been...
> I say this with love, reverence, and admiration for everything else Apple has done.
Taylor's post reminds me strongly of this article by Eli Schiff:
"Wilcox's flattery is not accidental. It was essential that Wilcox mentioned his qualification as an Apple fanatic, because that is, of course, the pre-requisite for saying anything remotely unfavorable about Apple."
– https://news.ycombinator.com/item?id=9256014
Was going to post the same. Her points obviously stand regardless, but this is an epic example of "I love Apple, but..." There's almost more gushing than criticism.
Couple of thoughts here:
1) If you're an indie artist and you can afford to opt-out of Apple Music on principle, then clearly you can afford to opt-in for the three free months. Either way you're not making money from Apple Music. If you opt-in, you make more money in the long-term. If you opt-out, you continue to earn from your current streaming and downloads.
2) If you think that Apple Music will be so earth-shatteringly successful from day one that it will destroy your business -- then your business model is razor thin and completely unsustainable.
1) If you're an indie artist and you can afford to opt-out of Apple Music on principle, then clearly you can afford to opt-in for the three free months. Either way you're not making money from Apple Music. If you opt-in, you make more money in the long-term. If you opt-out, you continue to earn from your current streaming and downloads.
2) If you think that Apple Music will be so earth-shatteringly successful from day one that it will destroy your business -- then your business model is razor thin and completely unsustainable.
How does (1) apply? Are there indie artists who are opting out?
A lot of it is all posturing right now, but there has been news of indie labels considering boycotting Apple Music, for instance:
http://www.theregister.co.uk/2015/06/16/apple_nopayforplays_...
http://www.theregister.co.uk/2015/06/16/apple_nopayforplays_...
It seems really weird to me that apple would get away with paying nothing for the 3 months. Especially since it's not like they are anything but yet another competitor in an already crowded space.
This whole "pay nothing" idea is strange to see on HN.
Apple developed the software, is footing the server, power, bandwidth, and ops bills for three months all for free. The labels are chipping in their content for three months.
Sounds like everyone is bringing something to the table. Apple is incurring real costs. The labels, not so much.
Three kinds of customers will try the service:
People who buy their music: these will either become long term subscribers or not like the service and buy the songs they want anyway. Perhaps slightly delayed.
People who currently freeload: no loss for the trial. Possible huge win if they subscribe.
People using another streaming service: this is where the labels might actually give something. If a customer cancels their existing service while trying Apple's that will reduce the label's take by up to ~25% for the year. Month alignment and a comparison period will both drop this.
I suspect the third category is not the target audience. A small loss on service switchers is worth the big win for the labels in converting freeloaders to customers.
Apple developed the software, is footing the server, power, bandwidth, and ops bills for three months all for free. The labels are chipping in their content for three months.
Sounds like everyone is bringing something to the table. Apple is incurring real costs. The labels, not so much.
Three kinds of customers will try the service:
People who buy their music: these will either become long term subscribers or not like the service and buy the songs they want anyway. Perhaps slightly delayed.
People who currently freeload: no loss for the trial. Possible huge win if they subscribe.
People using another streaming service: this is where the labels might actually give something. If a customer cancels their existing service while trying Apple's that will reduce the label's take by up to ~25% for the year. Month alignment and a comparison period will both drop this.
I suspect the third category is not the target audience. A small loss on service switchers is worth the big win for the labels in converting freeloaders to customers.
I don't think you understand how music usually works for most independent bands. As I've helped a couple friends put out independent albums, here's the basics.
A band will put in a long time creating an album: writing the songs, orchestrating, rehearsing, reworking, etc. Then they pay real money for recording, editing and mastering as well as paying an artist and photographer to create the album art. They're also creating marketing materials online and off. This is all for a usually small time period when a new album will sell. And when streaming (which generally makes them next to nothing) will hit its peak. All these costs are front loaded and then there's a usually short time period where the band hopes to make this money back. During this time, the band is spending additional money and time doing marketing and promotion as well.
Apple's deal is a raw one for these artists as they'll lose a good chunk of revenue during that small time period. And it will leech purchases away from iTunes as well. I can guarantee that Apple will have prominent notices within iTunes about which albums are available on Apple Music and suggest that would-be purchasers sign up.
Plus there's the fact that Apple is threatening independent artists with removal from iTunes if they don't agree to stream for free on Apple Music. And the fact that these artists can't just decide to sell the music themselves on their website to iOS users because, thanks to Apple's carefully-designed walled garden, iOS users can't download music from the web or 3rd party apps and add it to their music library like they can on Android.
A band will put in a long time creating an album: writing the songs, orchestrating, rehearsing, reworking, etc. Then they pay real money for recording, editing and mastering as well as paying an artist and photographer to create the album art. They're also creating marketing materials online and off. This is all for a usually small time period when a new album will sell. And when streaming (which generally makes them next to nothing) will hit its peak. All these costs are front loaded and then there's a usually short time period where the band hopes to make this money back. During this time, the band is spending additional money and time doing marketing and promotion as well.
Apple's deal is a raw one for these artists as they'll lose a good chunk of revenue during that small time period. And it will leech purchases away from iTunes as well. I can guarantee that Apple will have prominent notices within iTunes about which albums are available on Apple Music and suggest that would-be purchasers sign up.
Plus there's the fact that Apple is threatening independent artists with removal from iTunes if they don't agree to stream for free on Apple Music. And the fact that these artists can't just decide to sell the music themselves on their website to iOS users because, thanks to Apple's carefully-designed walled garden, iOS users can't download music from the web or 3rd party apps and add it to their music library like they can on Android.
> There's the fact that Apple is threatening independent artists with removal from iTunes.
Wrong. Apple has unequivocally stated that this isn't happening.
> iOS users can't download music from the web
Wrong. You can just add it using iTunes.
Wrong. Apple has unequivocally stated that this isn't happening.
> iOS users can't download music from the web
Wrong. You can just add it using iTunes.
> Wrong. Apple has unequivocally stated that this isn't happening.
A couple different independent artists online have stated that Apple told them this.
> Wrong. You can just add it using iTunes.
Did you purposely take my quote out of context to make your answer seem correct? I specifically said that iOS users can't download a song from the web or a 3rd party app and add it to their music library like they can on Android. On Android, I can download a song while out on the go from anywhere I want and add it to my music library. Every app can add music, every app can play music. Can you do that on iOS... or do you have to go back to your home computer, add the song to your computer, add it to your iTunes library and then sync it to your iPhone/iPad? The last time I helped a friend do this, this is what we had to do.
A couple different independent artists online have stated that Apple told them this.
> Wrong. You can just add it using iTunes.
Did you purposely take my quote out of context to make your answer seem correct? I specifically said that iOS users can't download a song from the web or a 3rd party app and add it to their music library like they can on Android. On Android, I can download a song while out on the go from anywhere I want and add it to my music library. Every app can add music, every app can play music. Can you do that on iOS... or do you have to go back to your home computer, add the song to your computer, add it to your iTunes library and then sync it to your iPhone/iPad? The last time I helped a friend do this, this is what we had to do.
> A couple different independent artists online have stated that Apple told them this.
Well I am far more likely to take the measured, legally considered statement from Apple over a single independent artist's Twitter posts. Apple would be in a for a world of hurt if they deliberately mislead people.
> Did you purposely take my quote out of context
No. I am an iOS user and half my music collection is from the web. It is completely legitimate to use iTunes to add it to your collection. Otherwise third party apps exist which allow you to download from the mobile web. I am not saying it isn't as flexible as Android but it is disingenuous to say it isn't possible.
Well I am far more likely to take the measured, legally considered statement from Apple over a single independent artist's Twitter posts. Apple would be in a for a world of hurt if they deliberately mislead people.
> Did you purposely take my quote out of context
No. I am an iOS user and half my music collection is from the web. It is completely legitimate to use iTunes to add it to your collection. Otherwise third party apps exist which allow you to download from the mobile web. I am not saying it isn't as flexible as Android but it is disingenuous to say it isn't possible.
> Well I am far more likely to take the measured, legally considered statement from Apple over a single independent artist's Twitter posts. Apple would be in a for a world of hurt if they deliberately mislead people.
Considering the way Apple lied... ehem... misspoke? misled people?... about ebooks, lying about music isn't that far fetched.
> No. I am an iOS user and half my music collection is from the web. It is completely legitimate to use iTunes to add it to your collection. Otherwise third party apps exist which allow you to download from the mobile web. I am not saying it isn't as flexible as Android but it is disingenuous to say it isn't possible.
So, as I said, it is impossible for an iOS user to just download a song and add it to their music library on the go. It would be technically easy for Apple to enable this, but they purposely disallow this to make it harder for customers to purchase from 3rd parties. The same way they won't let 3rd parties sell music within their apps without paying 30% to Apple (making it financially impossible).
Having to go all the way home, add your music to iTunes, plug your phone into your computer, and then sync to iTunes just to be able to add a single MP3 to your phone's music library may be "legitimate" but it's anything but reasonable. It's in this state solely to make it inconvenient to the user and push them into the open arms of iTunes.
Considering the way Apple lied... ehem... misspoke? misled people?... about ebooks, lying about music isn't that far fetched.
> No. I am an iOS user and half my music collection is from the web. It is completely legitimate to use iTunes to add it to your collection. Otherwise third party apps exist which allow you to download from the mobile web. I am not saying it isn't as flexible as Android but it is disingenuous to say it isn't possible.
So, as I said, it is impossible for an iOS user to just download a song and add it to their music library on the go. It would be technically easy for Apple to enable this, but they purposely disallow this to make it harder for customers to purchase from 3rd parties. The same way they won't let 3rd parties sell music within their apps without paying 30% to Apple (making it financially impossible).
Having to go all the way home, add your music to iTunes, plug your phone into your computer, and then sync to iTunes just to be able to add a single MP3 to your phone's music library may be "legitimate" but it's anything but reasonable. It's in this state solely to make it inconvenient to the user and push them into the open arms of iTunes.
They don't even have to be lying. Apple is a huge company, and it's entirely possibly that its representatives may have been making threats that were not, ah, officially authorized.
I don't think you understand how music usually works…
30 years playing in and recording with independent bands. Dong just fine on understanding up front investments.
30 years playing in and recording with independent bands. Dong just fine on understanding up front investments.
> 30 years playing in and recording with independent bands. Dong just fine on understanding up front investments.
Apologies, then. Though I am curious about your take on this... specifically why it differs from my other friends. All of my independent musician friends I know online and off think this is a raw deal as soon as they learn the details. I understand why it makes sense for the big labels (they don't care about artists' incomes and likely got a sweet payoff from Apple). But I'm curious why a smaller musician/music producer would be happy with it.
Apologies, then. Though I am curious about your take on this... specifically why it differs from my other friends. All of my independent musician friends I know online and off think this is a raw deal as soon as they learn the details. I understand why it makes sense for the big labels (they don't care about artists' incomes and likely got a sweet payoff from Apple). But I'm curious why a smaller musician/music producer would be happy with it.
I suspect mostly because I started making music in an age when duplicating a CD was not possible and MP3 hadn't happened. I view my music projects as producing something and then working to get it into customers' hands. Radio stations would play our music and not pay us any royalty (except the songwriter portion), and that was fine.
Enter MP3 and suddenly musicians are looking at a hostile world where their primary consuming demographic believes it is silly to pay for music at all. Bands have traditionally felt screwed by labels, now their customers are screwing them. Apple sets up a service where the labels contribution to the free trial period results in no revenue for bands and that's the distributor screwing them. That makes it pretty much the entire industry top to bottom.
I don't see it that way. Apple Music will likely tap a huge population that doesn't currently have a streaming service which is a great thing.
As far as "losing" micropayments from song plays during the trial… If someone is forced to listen to my song by their robot DJ and doesn't care enough to come see a concert or buy something, or listen to it in the future… that wasn't really a sale I missed out on. That was some poor schmuck that wasted 4 minutes of his listening time on my song and in some alternate economic system would have paid me for the privilege, but didn't.
Also: I'm eating in August no matter how this plays out.
Enter MP3 and suddenly musicians are looking at a hostile world where their primary consuming demographic believes it is silly to pay for music at all. Bands have traditionally felt screwed by labels, now their customers are screwing them. Apple sets up a service where the labels contribution to the free trial period results in no revenue for bands and that's the distributor screwing them. That makes it pretty much the entire industry top to bottom.
I don't see it that way. Apple Music will likely tap a huge population that doesn't currently have a streaming service which is a great thing.
As far as "losing" micropayments from song plays during the trial… If someone is forced to listen to my song by their robot DJ and doesn't care enough to come see a concert or buy something, or listen to it in the future… that wasn't really a sale I missed out on. That was some poor schmuck that wasted 4 minutes of his listening time on my song and in some alternate economic system would have paid me for the privilege, but didn't.
Also: I'm eating in August no matter how this plays out.
> Apple is incurring real costs. The labels, not so much.
It's really weird that you specify "developing the software" as a real cost, but not "developing the music".
It's really weird that you specify "developing the software" as a real cost, but not "developing the music".
The labels costs are already sunk. The direct costs of the trial are all apple's.
So creating software is hard and should be compensated, while creating music is easy and it should be given away for free.
By your logic everyone should support The Pirate Bay because they developed the software and they foot the server bill to distribute content.
By your logic everyone should support The Pirate Bay because they developed the software and they foot the server bill to distribute content.
Hmm, this comment needed more text, but I was about to step on stage using my phone, sorry…
In the creation of Apple Music, Apple didn't not require any musician to create more music. Apple did have to develop their delivery system.
Apple does not require any music owner to put their music in Apple Music. But if a music owner does want to be included, then when Apple isn't paid, the music owner doesn't get paid. When Apple isn't paid the music owner does not have to chip in on the operations costs, that's nice of them.
Stated a different way, during the promotional period which the music owner agrees to, to promote their music in what they believe will be a profit making venture, Apple will pay all of the distribution costs out of their own pockets.
About Pirate Bay (which I didn't really want to comment on, but HN won't let me edit the grand parent) The content owner's, by and large, did not agree to put their material on Pirate Bay. If the content owner's did, I'd use Pirate Bay all the time and pay for the privilege. Instead I have to wander the balkanized world of video content looking for which of the four services I subscribe to might have the video I want to watch. It is a terrible solution and should burn in fire, but we are stuck there for now.
In the creation of Apple Music, Apple didn't not require any musician to create more music. Apple did have to develop their delivery system.
Apple does not require any music owner to put their music in Apple Music. But if a music owner does want to be included, then when Apple isn't paid, the music owner doesn't get paid. When Apple isn't paid the music owner does not have to chip in on the operations costs, that's nice of them.
Stated a different way, during the promotional period which the music owner agrees to, to promote their music in what they believe will be a profit making venture, Apple will pay all of the distribution costs out of their own pockets.
About Pirate Bay (which I didn't really want to comment on, but HN won't let me edit the grand parent) The content owner's, by and large, did not agree to put their material on Pirate Bay. If the content owner's did, I'd use Pirate Bay all the time and pay for the privilege. Instead I have to wander the balkanized world of video content looking for which of the four services I subscribe to might have the video I want to watch. It is a terrible solution and should burn in fire, but we are stuck there for now.
> Apple does not require any music owner to put their music in Apple Music.
Of course they do. No music, no product.
Of course they do. No music, no product.
> So creating software is hard and should be compensated, while creating music is easy and it should be given away for free.
Except first features downloading and owning it and the other streaming rights through certain period of time.
Except first features downloading and owning it and the other streaming rights through certain period of time.
Apple is giving away three months of its software and servers for the streaming service. After the 3 month period, both Apple and the label/artist get paid.
But once Apple's service starts, the costs to develop it are already paid. Therefore it's a sunk cost, and we don't need to consider it here. ...right?
The labels and artists have already incurred the costs to produce the content, their costs do exist.
Apple built a service that wouldn't exist without the content. The content would still exist on other services without Apple though.
Apple built a service that wouldn't exist without the content. The content would still exist on other services without Apple though.
> artists have already incurred the costs to produce the content, their costs do exist.
no one is arguing that their costs don't exist, but that they have nothing to lose to put it on. It's not like the artist will somehow have a lower cost by _not_ putting it up.
no one is arguing that their costs don't exist, but that they have nothing to lose to put it on. It's not like the artist will somehow have a lower cost by _not_ putting it up.
Except they do have something to lose if they put it on. They will have a lower profit if listeners that would subscribe to another paying service or buy their music switch to Apple streaming.
> They will have a lower profit
You have zero evidence of this. We don't know and may not know for a number of years whether Apple Music is more profitable for artists (or not) than competitor services.
You have zero evidence of this. We don't know and may not know for a number of years whether Apple Music is more profitable for artists (or not) than competitor services.
We know for a fact that its going to be less profitable for at least three months, unless they were already making zero dollars.
I get the typical arguments that things being available free might not affect sales - but in this case I think they'll see a direct impact.
I think they'll get a pretty large amount of trial users simply by advertising it in iTunes - oh you're about to buy this album? Why don't you listen to it and the majority of our catalog free for three months instead?
Other than Android they have a lot of music use cases supported, free of charge - why would you buy?
I honestly don't know how much this will affect sales but Apple are certainly in a position to push users away from those sales and toward the free service.
I think they'll get a pretty large amount of trial users simply by advertising it in iTunes - oh you're about to buy this album? Why don't you listen to it and the majority of our catalog free for three months instead?
Other than Android they have a lot of music use cases supported, free of charge - why would you buy?
I honestly don't know how much this will affect sales but Apple are certainly in a position to push users away from those sales and toward the free service.
> oh you're about to buy this album? Why don't you listen to it and the majority of our catalog free for three months instead
I think it was Eddy Cue who said specifically in an interview that they will not do this.
Edit: from the Guardian
He also denies a recent report that Apple is planning to aggressively promote its new streaming service to people buying albums on the iTunes Store. “That’s the wrong way to look at it. You shouldn’t take a customer who’s buying an album, who’s happy buying an album, and try to tell them that what they’re doing is wrong,” he says.
“But we don’t have to, and we shouldn’t try to kill the iTunes Store or kill people that are buying music. If you’re happy buying a few albums a year and that’s the way you’d like to continue doing it … but if we can help you discover some new artists or some new albums through Connect or through listening to Beats 1 radio, great.”
I think it was Eddy Cue who said specifically in an interview that they will not do this.
Edit: from the Guardian
He also denies a recent report that Apple is planning to aggressively promote its new streaming service to people buying albums on the iTunes Store. “That’s the wrong way to look at it. You shouldn’t take a customer who’s buying an album, who’s happy buying an album, and try to tell them that what they’re doing is wrong,” he says.
“But we don’t have to, and we shouldn’t try to kill the iTunes Store or kill people that are buying music. If you’re happy buying a few albums a year and that’s the way you’d like to continue doing it … but if we can help you discover some new artists or some new albums through Connect or through listening to Beats 1 radio, great.”
What would you tell Youtube or Soundcloud? They also foot the bill.
Apple is placing the value of artists work at $0 in a bid gain market share. It should be them who incurs the full cost not the artist.
When the music is offered on free, the prime beneficiary is Apple.
Apple is placing the value of artists work at $0 in a bid gain market share. It should be them who incurs the full cost not the artist.
When the music is offered on free, the prime beneficiary is Apple.
Apple's enormous cost in launching the service is the best counterpoint I've read. 3 month free trial means no revenue for Apple too. Apple is certainly in a better position than most to endure atartup risk through trial.
There's another point being overlooked regarding how music is consumed: music is listened to repeatedly over months, and the free trial is no different than a promotional period. Artists, even indies, will still receive income from the myriad other services, and will soon receive a better rate from Apple. Distribution is an enormous service to the artists, and it's value shouldn't be overlooked.
That being said Taylor Swift has every right to pass on Apple's offer, and it's great for the recording industry to have a major check/balance like Swift.
Unrelated, but interested to see if artists will ever abandon the labels and go direct to distribution. I'm sure labels provide more value than people want to acknowledge.
Edit: formatting
There's another point being overlooked regarding how music is consumed: music is listened to repeatedly over months, and the free trial is no different than a promotional period. Artists, even indies, will still receive income from the myriad other services, and will soon receive a better rate from Apple. Distribution is an enormous service to the artists, and it's value shouldn't be overlooked.
That being said Taylor Swift has every right to pass on Apple's offer, and it's great for the recording industry to have a major check/balance like Swift.
Unrelated, but interested to see if artists will ever abandon the labels and go direct to distribution. I'm sure labels provide more value than people want to acknowledge.
Edit: formatting
I think you haven't quantified the artists' opportunity costs. The idea is a customer may swap a streaming service which pays artists for Apple's streaming service which doesn't pay artists. Therefore artists may be losing money they otherwise would have typically made.
It's okay, the notice is in your e-mail inbox and your music is already online... If you don't like it, write them an e-mail, put: "2 legit 2 quit" in the subject line. /s
As others point out, it doesn't make much sense for Apple to attempt this (not paying content producers during a 3-month trial) for the sake of money alone - they have the cash (even if subject to high taxes) to pay for a loss leader like this.
If that's not the primary motivation, I can think of two alternatives:
1. Apple lacks confidence in rolling this out - they don't even know if they'd make back their money using a loss leader of this magnitude. They don't feel that the service alone has any meaningful advantage over the competition, so they feel a need to compensate with an extraordinarily long trial period, and they're willing to abuse some of their market power to strong-arm content producers into (hopefully) covering the bill. As a tiny part of their overall business strategy, they are unwilling to make any large bets on it, regardless of their ability to cover a loss.
- or -
2. (probably more likely) Apple is so myopically over-confident that they believe this service will disrupt the music industry in the same way the App Store changed software distribution. They honestly feel that they are creating a new market here, not trying to steal market share from other streaming services. Consequently, they don't feel a need to justify covering any expense to content producers because in Apple's mind, content producers will give anything for the privilege of existing on Apple's revolutionary new service. This would represent a new opportunity for revenue above and beyond what the music industry has already come to expect.
If that's not the primary motivation, I can think of two alternatives:
1. Apple lacks confidence in rolling this out - they don't even know if they'd make back their money using a loss leader of this magnitude. They don't feel that the service alone has any meaningful advantage over the competition, so they feel a need to compensate with an extraordinarily long trial period, and they're willing to abuse some of their market power to strong-arm content producers into (hopefully) covering the bill. As a tiny part of their overall business strategy, they are unwilling to make any large bets on it, regardless of their ability to cover a loss.
- or -
2. (probably more likely) Apple is so myopically over-confident that they believe this service will disrupt the music industry in the same way the App Store changed software distribution. They honestly feel that they are creating a new market here, not trying to steal market share from other streaming services. Consequently, they don't feel a need to justify covering any expense to content producers because in Apple's mind, content producers will give anything for the privilege of existing on Apple's revolutionary new service. This would represent a new opportunity for revenue above and beyond what the music industry has already come to expect.
The case for the latter is extremely strong despite how you've framed it. Apple Music will overnight be on an install base of 700-800 million iOS devices plus Macs (and available on Android and on iTunes on Windows). That combined with the fact that Apple's customers have regularly shown they are willing to pay for apps/services/media makes it extremely likely that this service is going to rapidly expand the market for streaming customers in a short period of time. It's been reported that Apple's goal is a 100 million customers for Apple Music, that's 5 times the number of paid customers Spotify has.
Good points. Still though, I'm not sure install base alone will expand the overall market significantly, at least not quickly. Everyone I know with those devices already spends money on music in some form (subscription-based or digital downloads), or simply wouldn't pay for music at any price (they will milk the trial periods though). I anticipate many will switch to Apple Music, but that will be a switch, not a new form of spending.
Also keep in mind that parents may be willing to spend $.99 here and there for their kids' apps (which adds up fast, but not in a way that feels obvious), whereas few will be happy to sign up for a recurring subscription without at least weighing it against the well-known competition.
Also keep in mind that parents may be willing to spend $.99 here and there for their kids' apps (which adds up fast, but not in a way that feels obvious), whereas few will be happy to sign up for a recurring subscription without at least weighing it against the well-known competition.
Can anyone at Apple (or perhaps formally at Apple) explain why this is the case? It seems like a raw deal that no sane musician would ever agree to. Imagine if when the first iPhone came out AT&T told Apple they were giving every customer a free trial with the device for 3 months before they pay for it Apple would have laughed and chose another carrier for its exclusive deal. I don't agree with the model of payment that musicians currently expect (imagine if developers recieved payment everytime a user used and app!) but if that was the norm I don't think many would just agree to put their app on the appstore for 3 months without payment.
I imagine Apple's argument is:
(1) They bring an enormous number of new subscribers and that this 3 month trial maximizes revenue for everyone including the artist.
(2) they pay a slightly higher royaly share than spotify in part because of this longer trial.
(3) Apple shares revenue with the artist in the same 70/30 split we see elsewhere and the 30% is the finders fee they get for delivering many of their x hundred million users to the service. Since there's no revenue in the first 3 months, 70% of $0 is $0. Apple eats the bandwidth/server costs of the service in this time with no revenue coming in.
(4) Spotify paid users are fairly happy with that service and won't all switch to Apple Music overnight and the same with people who buy music and radio so it's not like all the money these artist's see turns off for 3 months. The free trial effect will be heavily staggered as a steady stream of users signs up over years.
(1) They bring an enormous number of new subscribers and that this 3 month trial maximizes revenue for everyone including the artist.
(2) they pay a slightly higher royaly share than spotify in part because of this longer trial.
(3) Apple shares revenue with the artist in the same 70/30 split we see elsewhere and the 30% is the finders fee they get for delivering many of their x hundred million users to the service. Since there's no revenue in the first 3 months, 70% of $0 is $0. Apple eats the bandwidth/server costs of the service in this time with no revenue coming in.
(4) Spotify paid users are fairly happy with that service and won't all switch to Apple Music overnight and the same with people who buy music and radio so it's not like all the money these artist's see turns off for 3 months. The free trial effect will be heavily staggered as a steady stream of users signs up over years.
> imagine if developers recieved payment everytime a user used and app!
Honestly, $10 a month to use every app sounds pretty good for me, bad for developers.
Honestly, $10 a month to use every app sounds pretty good for me, bad for developers.
It depends on how much uptake you get, doesn't it? For example, I spend less than $10/mo on apps (and for that matter, music too). If that's the case for enough users who get the new deal, this would be a net gain for developers. I think that's why you get developers(/musicians) to agree to it.
It's actually a bit better than that.
You're suggesting a simple view where you look at the average amount people who subscribe to this (e.g. $10/month) service would have otherwise paid, and that if that number is less than $10/month the devs (/musicians) win. This is certainly true.
However, there's the additional benefit that not every user that subscribes will entirely drop their purchasing habits. Perhaps less often, but some subscribers will buy apps (/music) on top of their subscription.
You're suggesting a simple view where you look at the average amount people who subscribe to this (e.g. $10/month) service would have otherwise paid, and that if that number is less than $10/month the devs (/musicians) win. This is certainly true.
However, there's the additional benefit that not every user that subscribes will entirely drop their purchasing habits. Perhaps less often, but some subscribers will buy apps (/music) on top of their subscription.
> Can anyone at Apple (or perhaps formally at Apple) explain why this is the case?
Apple is a super secret walled garden, full of itself. From my experience with people that work there, I doubt any of them would even know why (let alone come out here to explain).
Apple is a super secret walled garden, full of itself. From my experience with people that work there, I doubt any of them would even know why (let alone come out here to explain).
I didn't downvote but can see that some people might, in addition to what was previously mentioned, be upset by the vagueries of "From my experience with people that work there..." We don't know you - how many people do you know who have worked there? What were there roles (or thereabouts)? It's just so vague that I can't really derive any value from your post.
Could you explain the downvotes? I'm new to HN and would like to learn.
I would imagine the downvotes are because of the 'super secret walled garden, full of itself' comment, which is negative in tone. You could have said instead something like,
'As someone that knows people who've worked at Apple, I doubt many of them would know the answer to this or be allowed to post here if they did.'
https://news.ycombinator.com/newsguidelines.html
'As someone that knows people who've worked at Apple, I doubt many of them would know the answer to this or be allowed to post here if they did.'
https://news.ycombinator.com/newsguidelines.html
Snarky comments (like 'full of itself') tend to gain downmods just for that. It's a lot softer than it used to be, though - it used to be that using the lightest touch of humour would also bring the downmod brigade. HN is becoming a much more generic "tech and this-article-I-saw-on-nytimes" site.
> imagine if developers recieved payment everytime a user used and app
If software developers were compensated for their creative output the way musicians are there wouldn't be so many software developers.
I had a really innovative startup idea once where I planned to have developers work for years to create hit software products that made many people's life better and then get into a crappy van and travel the country to do 90 minute demos of their product for a few hundred dollars.
But only if they had a genuinely successful product mind you, obviously being merely competent at software development meant you didn't get paid at all, you had to actually amass significant numbers of fans of your products willing to come to these demos.
Never did figure out why I didn't get more developers interested in the platform.
If software developers were compensated for their creative output the way musicians are there wouldn't be so many software developers.
I had a really innovative startup idea once where I planned to have developers work for years to create hit software products that made many people's life better and then get into a crappy van and travel the country to do 90 minute demos of their product for a few hundred dollars.
But only if they had a genuinely successful product mind you, obviously being merely competent at software development meant you didn't get paid at all, you had to actually amass significant numbers of fans of your products willing to come to these demos.
Never did figure out why I didn't get more developers interested in the platform.
It's pretty obvious. They are going to take streaming to a whole new level. My dad doesn't know what Spotify is, but has an iPhone and is a couple of clicks away from lighting this service up.
You give away a couple of months, get people hooked and you and reap years of recurring revenues. It's a model that works for drug dealers, razor blade makers (Gilette gives away 5 packs of blades in many schools) and SaaS companies.
I don't really feel too bad for Taylor Swift. She doesn't get a dime from radio airplay as an artist. But she benefits immensely from the marketing and promotional value of having it played.
You give away a couple of months, get people hooked and you and reap years of recurring revenues. It's a model that works for drug dealers, razor blade makers (Gilette gives away 5 packs of blades in many schools) and SaaS companies.
I don't really feel too bad for Taylor Swift. She doesn't get a dime from radio airplay as an artist. But she benefits immensely from the marketing and promotional value of having it played.
Artists who's songs are played on the radio are paid for every time it's played on air. Or did I get your last sentence wrong there?
In the US, for radio performances, its only the person who wrote the song that gets paid. The artist who sang the song usually get nothing.
Only if they are registered as a songwriter:
http://blog.songtrust.com/publishing-tips-2/what-you-didnt-k...
Internet radio is different, as it's not considered to be a public performance.
Internet radio is different, as it's not considered to be a public performance.
As someone else alluded to: drug suppliers still get paid for those free 'hits'. It's the distributor who swallows the cost in exchange for recurring revenue.
Well, you can buy apps - which also applies to albums/music.
> (or perhaps formally at Apple)
You were probably looking for formerly.
You were probably looking for formerly.
Both sides of this disagreement are hilariously petty. Both desperate to hold on to every last penny they can get hold of.
The music industry has been dying for a while but this really is a fantastic example of it. Everyone who thought Apple cared about artists now has to come up with a new rationalisation.
The music industry has been dying for a while but this really is a fantastic example of it. Everyone who thought Apple cared about artists now has to come up with a new rationalisation.
Did you not read the whole post or do you just not believe her?
> 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 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.
Considering she's 25 and her net worth is north of $300mil...I don't think the money is relevant to her
I don't believe her. She wasn't some struggling songwriter desperately touring with a band. It's just guff.
Though this might seem a raw deal for artists I think it should be considered that the artists (and record labels etc) are effectively business partners with Apple.
What they are really doing here is asking the other side of the partnership to participate in the loss leader effort. Apple provides the platform development + storage and delivery infrastructure, the artists provide the content.
When you consider it as a partnership it doesn't seem so reprehensible, they are both forgoing income to secure future recurring income.
I think what people are upset about is the fact Apple has a big war chest when many artists do not. Fundamentally this isn't really Apple's fault though, likely this deal was brokered by their biggest partners - huge record labels. Huge record labels also have big war chests and are probably fine with the arrangement.
It makes good business sense if you are a record label or Apple, less so if you are an independent artist but maybe not no sense at all, I don't know what exposure is worth.
Unfortunately Apple can't create a 2 tier system where they have the big record labels foot the cost of the indie artists nor can their ignore the obvious good business sense of the loss leader approach.
What they are really doing here is asking the other side of the partnership to participate in the loss leader effort. Apple provides the platform development + storage and delivery infrastructure, the artists provide the content.
When you consider it as a partnership it doesn't seem so reprehensible, they are both forgoing income to secure future recurring income.
I think what people are upset about is the fact Apple has a big war chest when many artists do not. Fundamentally this isn't really Apple's fault though, likely this deal was brokered by their biggest partners - huge record labels. Huge record labels also have big war chests and are probably fine with the arrangement.
It makes good business sense if you are a record label or Apple, less so if you are an independent artist but maybe not no sense at all, I don't know what exposure is worth.
Unfortunately Apple can't create a 2 tier system where they have the big record labels foot the cost of the indie artists nor can their ignore the obvious good business sense of the loss leader approach.
Unfortunately Taylor does something similar with concert photographers (grants Taylor unlimited usage with a large scope, severely restricts photographers' usage):
https://junction10.wordpress.com/2015/06/21/those-in-glass-h...
https://junction10.wordpress.com/2015/06/21/those-in-glass-h...
For anyone suggesting that Taylor is not greedy, most artists don't get the majority of the money from airplay, the record labels do. Apple's move is to cut record labels massive control grip on the market, not to rip off the artist. Taylor Swift is in a very unique positions to have a very lucrative record deal with her label. Most artists don't, that's why you are hearing from her and not others.
It was the same situation with Metallica and Napster. They got the majority of the money from their record sales. Most artists are just interested in the massive distribution these platforms offer, so when a relatively small act shows up in your town you might have heard of them. The live show is were most acts make any money anyway.
Many years ago, I recorded a number of albums with different bands. On average, for every $10 album sold, I would get 10 cents, paid to me after the label recoups costs. When you aren't Taylor Swift, that is the deal most artist are offered through a record label.
It was the same situation with Metallica and Napster. They got the majority of the money from their record sales. Most artists are just interested in the massive distribution these platforms offer, so when a relatively small act shows up in your town you might have heard of them. The live show is were most acts make any money anyway.
Many years ago, I recorded a number of albums with different bands. On average, for every $10 album sold, I would get 10 cents, paid to me after the label recoups costs. When you aren't Taylor Swift, that is the deal most artist are offered through a record label.
Curious to understand... what's the point of getting 1% of any sale of something that wouldn't be there to sell in the first place had you not created it? I find it really hard to believe that labels guarantee you'll get over 100 times the amount of sales that you'd get without them. Do they?
I don't know that I completely understand your question... The point is to create something. Your other question, the label guarantees nothing... Often after recording and publishing the artist is left in debt to the label for all expenses, the label then charges exorbitant rates for studio, legal, duplication, and doesn't pay a dime to the artist till the money is recouped. Often artist who don't sell enough albums are left in debt to the label and then summarily dropped. Most of the time after only one album. Swift is abviously far beyond this status and can command a massive sway when it comes to crafting her new contracts.
3 months free is a way for Apple to promote its service against its competitors, and they need to do this promotion because they're late-comers. There is nothing to gain for the creators of music in getting more people to use Apple streaming service instead of Spotify or Google, so, why should they finance Apple's promotion?
> There is nothing to gain for the creators of music in getting more people to use Apple streaming service instead of Spotify or Google
Are you sure? Because Apple are promising to pay higher royalties. That sure seems like not nothing to me. Now, I pass no judgement on whether the financial calculus works out for 3 months of free usage, but to be honest saying there's "nothing to gain" is being dishonest.
Are you sure? Because Apple are promising to pay higher royalties. That sure seems like not nothing to me. Now, I pass no judgement on whether the financial calculus works out for 3 months of free usage, but to be honest saying there's "nothing to gain" is being dishonest.
Hate to make the comparison, but drug dealers have a saying "the first hit is free." In this context, I think making the first months free lowers resistance to get people on the service, and will ultimately serve artists better in the long run. That said, I don't know what rates Apple pays out to artists who use this service, so I can't comment there. Anyhow, Apple has always run its business very aggressively so this move does not surprise me. $0.02
> In this context, I think making the first months free lowers resistance to get people on the service, and will ultimately serve artists better in the long run
So, Apple should pay for it, rather than attempting to enforce themselves as a middleman who takes only profit as they have done in every other sphere.
So, Apple should pay for it, rather than attempting to enforce themselves as a middleman who takes only profit as they have done in every other sphere.
On the other hand I could argue that making apple pay leads to fewer/smaller free trials which leads to less money for the artists.
Making Apple's revenue be directly tied to artist revenue makes a lot of sense.
Making Apple's revenue be directly tied to artist revenue makes a lot of sense.
> On the other hand I could argue that making apple pay leads to fewer/smaller free trials which leads to less money for the artists.
How? The trials would still be free. Nothing would change for the consumer, therefore you couldn't argue that.
How? The trials would still be free. Nothing would change for the consumer, therefore you couldn't argue that.
Let's have a hypothetical scenario with simplified numbers. The trial distributes $20M in music and leads to $10M more in customers after a year. Half the revenue goes to Apple, half to the artists.
If Apple doesn't pay the artists for the trial, then they run the trial and get $5M extra profit. The artists get $5M extra profit. The audience gets more music. Everyone wins.
If Apple pays the artists for the trial, they see that it will cost them $10M licensing to get back a mere $5M. They don't run the trial. Nobody wins.
Edit: fixed the numbers
If Apple doesn't pay the artists for the trial, then they run the trial and get $5M extra profit. The artists get $5M extra profit. The audience gets more music. Everyone wins.
If Apple pays the artists for the trial, they see that it will cost them $10M licensing to get back a mere $5M. They don't run the trial. Nobody wins.
Edit: fixed the numbers
> They don't run the trial. Nobody wins.
Their competitors win. The artists make out the same or better. Apple isn't the only player on the market, even though they act that way.
Their competitors win. The artists make out the same or better. Apple isn't the only player on the market, even though they act that way.
I agree - Apple should pay for it, but I don't think they will unless this causes some uproar (which it could).
> Hate to make the comparison, but drug dealers have a saying "the first hit is free."
There's a difference between not charging the end user and not paying the supplier.
There's a difference between not charging the end user and not paying the supplier.
Good point :)
In your comparison, the dealer has to pay the cost of this free sample, not the drug producer.
Offering several weeks/months for free is nothing new in the music streaming industry but usually the service is the one that has to swallow that cost.
Additional note - I'm not condoning this behavior, just saying that it does not surprise me :)
So Apple run a loss-leader... where they don't incur the loss, and just get the lead.
Scum.
Scum.
Any definition of loss that says Apple suffers none would also say that the artists suffer none.
Likewise, any lead Apple gets here is shared with the artists.
This is rude to force on artists without asking, but only because they're not asking. It's not scummy.
Likewise, any lead Apple gets here is shared with the artists.
This is rude to force on artists without asking, but only because they're not asking. It's not scummy.
Except the loss-leader is being used to steal users from other streaming radio services that _are_ currently paying labels & artists. So any users that switches from Spotify to Apple for example is a user that was paying artists but is now not for 3 months.
That analogy would apply if the loss got people in the door, but they bought SOMETHING ELSE that ensured profits. For example, in this case if free music got them onto Apple's platform (loss) where they then bought a bunch of apps (unrelated to music and the source of profit).
For anyone who doesn't know, a loss leader is something advertised like bread for 50 cents or something, where the store loses money on each and every sale. It's a customer acquisition cost, and the goal of this is to "lead" with the loss, get people in the store, and there they will buy not only bread but anything else they need at the time, at normal market prices. Normal market prices give enough profit to offset the loss taken on the "lead." This works because people don't just go to a store and buy the one marked-down item and nothing else. (Or more specifically the extra profit for people who buy other things after only coming in due to the loss leader, covers the loss on them, and on everyone who only gets the loss leader.)
For anyone who doesn't know, a loss leader is something advertised like bread for 50 cents or something, where the store loses money on each and every sale. It's a customer acquisition cost, and the goal of this is to "lead" with the loss, get people in the store, and there they will buy not only bread but anything else they need at the time, at normal market prices. Normal market prices give enough profit to offset the loss taken on the "lead." This works because people don't just go to a store and buy the one marked-down item and nothing else. (Or more specifically the extra profit for people who buy other things after only coming in due to the loss leader, covers the loss on them, and on everyone who only gets the loss leader.)
That's a specific (but common) use of the loss-leader strategy, but not the definition.
The strategy itself is to sell something at a loss, to get a lead/marketshare/conversion.
The strategy itself is to sell something at a loss, to get a lead/marketshare/conversion.
well, if you type "loss leader" into Google an infobox pops up that says "A loss leader (also leader) is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services" which it got from Wikipedia, whose article doesn't mention what you call the strategy.
Try typing:
define: loss leader
define: loss leader
I agree with everything she said... but she didn't answer the question she posed at the start: why is she withholding 1989, (and not any of her other albums), and what does that have to do with the 3 month trial? If she disagrees with the free trial don't put any of your music up for that time span.
She probably is withholding the rest like on Spotify but people typically only care about the newest album. Alternatively maybe it's to stop them from being able to promote their service as being the only one with 1989 on it?
There may be pre-existing contractual obligations that make it harder to pull the back catalogue.
Or she and her label recognize that the back catalog is not as valuable as the latest album. Giving away access to the back catalog on free streaming services will act to develop fans, and increase purchases of the new album. This new album that is not available on free streaming services.
The one album can be seen as her token of protest without going as far as shunning the service as a whole. So, this is probably a carefully calibrated objection, and we're not privy to the details of why she did it this way and not some other way.
> If she disagrees with the free trial don't put any of your music up for that time span
Because Apple will not allow her to do so. It is not 3 universal calendar month: every user gets 3 months free when they start a subscription, depending on when they sign up for the service. Artist cannot opt-out of the free-service tier catalog and just go with the paid users.
So Taylor Swift is withholding her music because she won't get paid for all the listens by users in their first 3 months.
Because Apple will not allow her to do so. It is not 3 universal calendar month: every user gets 3 months free when they start a subscription, depending on when they sign up for the service. Artist cannot opt-out of the free-service tier catalog and just go with the paid users.
So Taylor Swift is withholding her music because she won't get paid for all the listens by users in their first 3 months.
My thought is Apple can offer opt-in for artists who wish to get unpaid during the trial period. Some artists would want to get some exposures instead of cash.
For those who want to get paid from the start, their work will only be available to paying customers.
I don't see this is a major change to be made by Apple, and it is a win-win.
For those who want to get paid from the start, their work will only be available to paying customers.
I don't see this is a major change to be made by Apple, and it is a win-win.
Apple knows exactly how opt-in works (majority stick with defaults + status quo bias). The service wouldn't make very good impression when you can't find most of artists.
(Still of course I agree that they should cover the cost not artists)
(Still of course I agree that they should cover the cost not artists)
Out of curiosity, and on a similar note, is Spotify not paying artists during their "3 months for $0.99 promotional period"?
I guess that would explain why her 1989 album isn't there either... At least she's consistent.
I'd lean on the side of Apple eating the cost during the period, not the artists.
I guess that would explain why her 1989 album isn't there either... At least she's consistent.
I'd lean on the side of Apple eating the cost during the period, not the artists.
With the market cap and war chest they have, it's incredibly disappointing that Apple expects artists to bear the brunt of Apple's business decision.
For every Taylor Swift there are thousands of artists just scraping by (and thousands more hoping to reach "just scraping by.")
I lose a decent amount of respect for Apple with this call. (And Taylor Swift is hardly the first artist to express disappointment and/or outrage at this "decision" by Apple.)
For every Taylor Swift there are thousands of artists just scraping by (and thousands more hoping to reach "just scraping by.")
I lose a decent amount of respect for Apple with this call. (And Taylor Swift is hardly the first artist to express disappointment and/or outrage at this "decision" by Apple.)
Do you think the labels don't have a war chest? Most of the big artists are not independents but part of a mega corp label.
I'm not sure about your Spotify question, but I believe Taylor Swift pulled all her music from there because they wouldn't agree to making it paid only (referring to their freemium offering and not the trial there). I think that's why beyond this she has so much respect for Apple's offering - they're obviously already an important player and artists want paid - and only paid, streaming.
Honestly from the point of view it's pretty good for consumers. Making her album paid-only would have improved the conversion-to-premium rate, whereas making her album free increases active users. I guess they opted for more users, maybe to look more attractive for more funding?
Yep, they do have a fantastic conversion rate though - last I read was 15m paying of 60m users [0] - 25% must be among the best for freemium. So in that sense I can see why they probably optimise heavily for more users.
I imagine there are a fair chunk of artists who would take the premium only route if they could too - I guess they want to avoid that.
[0] http://www.theguardian.com/technology/2015/jan/12/spotify-60...
I imagine there are a fair chunk of artists who would take the premium only route if they could too - I guess they want to avoid that.
[0] http://www.theguardian.com/technology/2015/jan/12/spotify-60...
If only the labels had 5 years ago put a reasonable music licensing system in place for the digital world... we might now have a burgeoning ecosystem of startups and niche music services competing to provide a great customer experience instead of a couple of giants.
Apps that are "beta", "demo", "trial", or "test" versions will
be rejected
Apple disallows apps whose only purpose is one of beta, demo, trial or test. You are more than allowed to set up a trial period then charge an in-app purchase/subscription to continue using the service.
“We don’t ask you for free iPhones,” she added. “Please don’t ask us to provide you with our music for no compensation.”
Funny, her best line and I would wager she hasn't paid for an iPhone or any consumer electronics (or any branded good for that matter) in years if ever given her family history. I find her use of the royal "we" arrogant.
I really do not understand the issue. What Apple is creating is a unified platform for exposure to music and musicians not just a streaming music service. With Connect artists take their fans into their lifestyle and the creative process to gain traction / engagement.
A "free trial" is exactly the kind of thing that would induce consumers to use it away from the hodgepodge networks out there now, all of which Swift, Inc seems to use exorbitantly to prop up her brand (web, mobile app, fb, twitter, instagram, tumblr, vine, ....) but which is next to impossible for an indie artist to maintain on his/her own.
I can understand why the economic return on her investment in Apple Music may not be in Swift Inc's best interest but not the community she is appointing herself to represent.
Seems like a no-brainer to me and also an opportunity for someone here to create some tools to create and maintain a presence on Connect for artists ready to go with content when it launches.
Funny, her best line and I would wager she hasn't paid for an iPhone or any consumer electronics (or any branded good for that matter) in years if ever given her family history. I find her use of the royal "we" arrogant.
I really do not understand the issue. What Apple is creating is a unified platform for exposure to music and musicians not just a streaming music service. With Connect artists take their fans into their lifestyle and the creative process to gain traction / engagement.
A "free trial" is exactly the kind of thing that would induce consumers to use it away from the hodgepodge networks out there now, all of which Swift, Inc seems to use exorbitantly to prop up her brand (web, mobile app, fb, twitter, instagram, tumblr, vine, ....) but which is next to impossible for an indie artist to maintain on his/her own.
I can understand why the economic return on her investment in Apple Music may not be in Swift Inc's best interest but not the community she is appointing herself to represent.
Seems like a no-brainer to me and also an opportunity for someone here to create some tools to create and maintain a presence on Connect for artists ready to go with content when it launches.
Is software free trial similar to this? Don't we, as developers, give our software for free in either a freemium or free trial business models? One freemium tool I'm involved in only monetizes 2-3% of our users... But it's a model that works as far as marketing goes.. Not saying you shouldn't pay artists but isn't this another form of marketing to users? In the end, it's win-win. Apple gets more users, artists gets more listens...
The "deal" is first of all unfair to Spotify, Rdio and other competitors who still have to pay royalties during their free trial.
On one hand, the music industry tries to get higher revenue on every front but then agrees to something that has essentially one goal in mind, to kill off any competitive streaming market, which will eventually lead to them being solely dependent on Apple. Interestingly enough, all major labels have stake in Spotify (not sure about the exact number but around 20-30% in total). Why do they now apply different rules, I don't know.
Unless of course Apple demanded not to pay any royalties, in which case the music industry is really hopeless (again). The cry for "we love you Apple but pretty please, we gave you all our music, would you mind paying us" just confirms that. They feel being robbed in an era for which they've been long overdue with a business model, don't know what to do, and look up to big brother to save them.
I love Apple's products, their marketing is brilliant, and they cleverly use all their power to make the most money out of anything. But they're getting more and more hungry and arrogant every year. Microsoft, anyone?
On one hand, the music industry tries to get higher revenue on every front but then agrees to something that has essentially one goal in mind, to kill off any competitive streaming market, which will eventually lead to them being solely dependent on Apple. Interestingly enough, all major labels have stake in Spotify (not sure about the exact number but around 20-30% in total). Why do they now apply different rules, I don't know.
Unless of course Apple demanded not to pay any royalties, in which case the music industry is really hopeless (again). The cry for "we love you Apple but pretty please, we gave you all our music, would you mind paying us" just confirms that. They feel being robbed in an era for which they've been long overdue with a business model, don't know what to do, and look up to big brother to save them.
I love Apple's products, their marketing is brilliant, and they cleverly use all their power to make the most money out of anything. But they're getting more and more hungry and arrogant every year. Microsoft, anyone?
My wife is a musician and we have this argument all the time. She's not a recording artist or anything, but she does complain of abuse in the deals her different bands and groups get at venues. And I say, that's supply-demand, that's the way business is done, how much is the venue getting out of the concert? How can you compete when there's so much people playing for free or on much lower cuts? What can you do if the end-customer prefer not to pay cover charges or see the value in live music? etc. etc. It's a music business after all.
So Taylor Swift's plead is pathetic, "Thankfully... I can support myself," deceiving "by playing shows" [1] and even condescending, "This is about the young songwriter who just got his or her first cut... who works tirelessly." Oh, come on!
You don't agree with the terms of the deal, so you pulled out. Fine. Now your fans who are going to try this new service won't have access to your latest album. That's the price of your decision. To me that's fair game, show a little muscle to your distributors, maybe get a better deal. Now, please don't try to spin this as some social injustice towards creative people. Just because you're an artist it doesn't mean you're immune to market laws. Taylor Swift is a billion-dollar business. Stop treating music fans like we're stupid.
[1] "Swift had sold over 40 million albums, 130 million single downloads and was one of the top five music artists with the highest worldwide digital sales" -- http://www.ifpi.org/news/Taylor-Swift-named-IFPI-global-reco...
So Taylor Swift's plead is pathetic, "Thankfully... I can support myself," deceiving "by playing shows" [1] and even condescending, "This is about the young songwriter who just got his or her first cut... who works tirelessly." Oh, come on!
You don't agree with the terms of the deal, so you pulled out. Fine. Now your fans who are going to try this new service won't have access to your latest album. That's the price of your decision. To me that's fair game, show a little muscle to your distributors, maybe get a better deal. Now, please don't try to spin this as some social injustice towards creative people. Just because you're an artist it doesn't mean you're immune to market laws. Taylor Swift is a billion-dollar business. Stop treating music fans like we're stupid.
[1] "Swift had sold over 40 million albums, 130 million single downloads and was one of the top five music artists with the highest worldwide digital sales" -- http://www.ifpi.org/news/Taylor-Swift-named-IFPI-global-reco...
It makes sense. Apple is launching a service for their own profit motives. Service is new and has no traction, they need a marketing move to build traction. One of those moves is a free trial with other people's IP. Those people will, presumably, profit as well from the service once it gains traction. In the meantime, Apple - the initiator and owner of said service, asks other people to foot the marketing bill for their own business. Which wouldn't be an odd proposition if
a) it was a service first of its kind in a non-crowded space
and
b) some types of IP in this sector is time sensitive (airplay on pop hits is measured in months after launch and drops off, like games)
c) apple is loaded with cash
a) it was a service first of its kind in a non-crowded space
and
b) some types of IP in this sector is time sensitive (airplay on pop hits is measured in months after launch and drops off, like games)
c) apple is loaded with cash
I must say, Swift is a pretty good writer; yet this perception is warped by my surprise to be honest. I guess I'll go looking out for more of her written works when I next have a free moment to make a better judgement.
Taylor did not write that... at least I don't think that she did.
You'd be surprised. I'm not a fan of her music (if I had kids they probably would be) but she's very hands-on with her image and if it's on her tumblr page, she wrote it. I respect her as a person and from what I've seen she's very intelligent and articulate.
> very hands-on with her image
As compared with whom? Ariana Grande? Metallica? Madonna? Jello Biafra? Efrim Menuck? Nicki Minaj?
Sure, she's probably market-positioned as "more authentic" than Paris Hilton. You shouldn't be blinded by the marketing any more than you should believe Iron Maiden to be devil-worshippers.
> intelligent and articulate.
Which usually translates to "White, non-Southern American accent". ("British" also applies, but usually to men.)
As compared with whom? Ariana Grande? Metallica? Madonna? Jello Biafra? Efrim Menuck? Nicki Minaj?
Sure, she's probably market-positioned as "more authentic" than Paris Hilton. You shouldn't be blinded by the marketing any more than you should believe Iron Maiden to be devil-worshippers.
> intelligent and articulate.
Which usually translates to "White, non-Southern American accent". ("British" also applies, but usually to men.)
She's also a multi-millionare. I doubt she has time for this and it's managed by her company, pr, and/or lawyers.
By that logic, Jobs didn't write http://www.apple.com/hotnews/thoughts-on-flash/ or his "thoughts on music" (which seem to have disappeared from Apple.com), either.
There was a time when people used to calculate how much money would have to be lying on the ground for it to be worth Bill Gates' time to simply stop, lean down, and pick it up...
And when asked during his last AMA BillG said he would stop, lean down and pick up any money he saw on the ground. But then he'd give it to his foundation.
I hope you do realize companies get paid handsomely to properly manage PR and make people believe they are actually the person they are representing, writing the PR. Or do you also believe Obama writes his own speeches? In fact, you believing she actually wrote that is exactly why those PR companies are in business.
She absolutely didn't write that, she has an entire PR firm at her disposal. The same way most politicians do not write any of their speeches. Do you really think most "stars" directly manage their "own" tumblr,facebook or twitter accounts? of course not.
I got vilified as a troll on reddit for suggesting such a thing. A reply to me earnestly said something to the effect of: I don't know anything about twitter, but I'm sure <washed up star> follows <big movie franchise>.
"Swift gets her fans, and instead of keeping to herself she builds a relationship with her audience through Twitter and Instagram. She acts as her fans best friend as opposed to their untouchable celeb crush. And she does it all herself, no assistant at hand."[1]
I get why you think that way, because most celebrities do indeed hire PR firms and assistants to handle their fan relationships. Ms. Swift is unique in the fact that she doesn't, and it's documented well enough that even a non-fan like me knows about it. I wouldn't have said what I did above if I didn't know it to be true.
[1] http://www.businessinsider.com/taylor-swift-is-a-business-ge...
I get why you think that way, because most celebrities do indeed hire PR firms and assistants to handle their fan relationships. Ms. Swift is unique in the fact that she doesn't, and it's documented well enough that even a non-fan like me knows about it. I wouldn't have said what I did above if I didn't know it to be true.
[1] http://www.businessinsider.com/taylor-swift-is-a-business-ge...
I'm sure she wrote it, but I'm also sure not a word of it didn't get approved by her lawyers and PR people, and they probably had to do a hefty amount of editing to ensure the tone and words are just right (and don't harm any contracts they may have with apple.)
I mean I'm sure she's great, but she's also a brand and a business in her own right. Stuff like this is too important to let an artist just go off and say whatever she feels.
I mean I'm sure she's great, but she's also a brand and a business in her own right. Stuff like this is too important to let an artist just go off and say whatever she feels.
Indeed! The ranks of high literature have not seen such finesse & Swift wit in prose since dear Jonathan and Gulliver's Travels.
(it's not War and Peace FFS, it's not even written at a college level. Why are people surprised or even impressed by basic literacy?)
(it's not War and Peace FFS, it's not even written at a college level. Why are people surprised or even impressed by basic literacy?)
Lets pretend for a second that it's not that the artist is NOT getting paid for 3 months, but they (Apple) are delaying their payment for 3 months. The 3 months Free is to entice people into subscribing to Apple Music, and the more people that end up scribing the better.
I think at the end of the day (or end of 3 months) more people will have subscribed to Apple Music then before and the artist will be making more money.
Personally i think the real winners are the record labels who seem to get the lions share of the money.
Also when Goole Music was released it was free for a limited time... did they pay artist/record labels?
I think at the end of the day (or end of 3 months) more people will have subscribed to Apple Music then before and the artist will be making more money.
Personally i think the real winners are the record labels who seem to get the lions share of the money.
Also when Goole Music was released it was free for a limited time... did they pay artist/record labels?
Can anyone explain the intent here? It seems like a ridiculous decision by Apple any way I look at it... and I'm an active opponent of the major labels & right-holder organizations.
If Apple is trying to shift to a user-subscription model and pay the labels (ultimately, artists) net-90, that's great, however it's obvious to anyone who's run a bootstrapped business that an unforeseen, 90 day break in cash flow can be an unrecoverable setback.
Not for big labels. They can weather the storm (though precedent dictates they'll pass as much of this cost on to their artists as legally possible).
The financial situation of end content creators and smaller studios is far more variable. Some will be fine. Others (especially those with content scheduled for release within this 3-month window) could be completely overwhelmed. This simply consolidates more market power into the hands of currently-large labels, and generates ill will toward Apple elsewhere.
Why would a company that seems to want to attract self-publishers into its walled garden not find a structured solution to bridge the gap?
I'm all for forcing artists to stream their music (I'm looking at you, Taylor Swift), because I see how that can ultimately make everyone more money.
Arbitrarily disrupting cash flow, though, in order to run an experiment and offload your acquisition costs is a pretty offensive, and surprising move by a company with hundreds of billions in fungible assets.
If Apple is trying to shift to a user-subscription model and pay the labels (ultimately, artists) net-90, that's great, however it's obvious to anyone who's run a bootstrapped business that an unforeseen, 90 day break in cash flow can be an unrecoverable setback.
Not for big labels. They can weather the storm (though precedent dictates they'll pass as much of this cost on to their artists as legally possible).
The financial situation of end content creators and smaller studios is far more variable. Some will be fine. Others (especially those with content scheduled for release within this 3-month window) could be completely overwhelmed. This simply consolidates more market power into the hands of currently-large labels, and generates ill will toward Apple elsewhere.
Why would a company that seems to want to attract self-publishers into its walled garden not find a structured solution to bridge the gap?
I'm all for forcing artists to stream their music (I'm looking at you, Taylor Swift), because I see how that can ultimately make everyone more money.
Arbitrarily disrupting cash flow, though, in order to run an experiment and offload your acquisition costs is a pretty offensive, and surprising move by a company with hundreds of billions in fungible assets.
Not sure I understand this argument. Shouldn't she complain about the record companies rather than Apple? It's not like Apple's making money during that free 3 month period.
What do the records company have to do with Apple demanding that she gives away her songs for free to stay on iTunes music service?
In deals like this, service providers don't have the upper hand, content providers do. Apple wouldn't have been able to offer free 3 month trial if record companies wouldn't have agreed to it. Maybe I'm misinformed, but did Apple come out and say that if she doesn't put her albums on its streaming service, she'd be off iTunes music service? Why on earth would they do that? It'd be a PR nightmare for them and they'd lose money.
Anton Newcombe claimed[1] the Apple rep threaten to kick him off iTunes if he didn't agree to join Music, but Apple has since denied it.
[1] https://twitter.com/antonnewcombe/status/611122009007882240
[1] https://twitter.com/antonnewcombe/status/611122009007882240
That's only to join Apple Music, not to stay on iTunes.
Apple Music's big problem is that the service itself offers nothing new - most of the people that are going to paid for paid music will use Spotify already, and getting them to switch will be hard.
I suspect that Apple knows that the take up for the three month free trial will be huge, but that conversion to paid will be a much harder row to hoe.
This is all about Apple not wanting to foot the bill if and when people switch back to what they were doing already (Spotify, YouTube) without paying Apple a dime.
I suspect that Apple knows that the take up for the three month free trial will be huge, but that conversion to paid will be a much harder row to hoe.
This is all about Apple not wanting to foot the bill if and when people switch back to what they were doing already (Spotify, YouTube) without paying Apple a dime.
None of the streaming services (including existing services Rdio and Spotify) offer anything unique. In my opinion, the only thing the truly separates them is catalogue size.
Spotify has a freemium tier that converts extraordinarily well.
> Apple Music's big problem is that the service itself offers nothing new.
Eh. Apple Music is mediocre and that's ok.
It's instantly going to be the default music player on hundreds of millions of iPhones overnight. At worst, they're going to get the same usage as Spotify.
Eh. Apple Music is mediocre and that's ok.
It's instantly going to be the default music player on hundreds of millions of iPhones overnight. At worst, they're going to get the same usage as Spotify.
I'd suggest that most of the people that want to pay to stream music through their iPhones already use Spotify - the rest use YouTube and pay nothing.
Apple pushing the labels to nix Spotify's freemium tier was no accident. Mediocre service + paid + Apple brand = no longer good enough.
Apple pushing the labels to nix Spotify's freemium tier was no accident. Mediocre service + paid + Apple brand = no longer good enough.
Apple Music does offer a number of features over Spotify:
a) Siri. With the existing Music app I can tell Siri to play a particular artist or playlist. I would expect far deeper integration.
b) Watch. The Music app is native, has a glance.
c) Desktop. Spotify client on the desktop is slow and clunky. iTunes on the Mac is anything but.
a) Siri. With the existing Music app I can tell Siri to play a particular artist or playlist. I would expect far deeper integration.
b) Watch. The Music app is native, has a glance.
c) Desktop. Spotify client on the desktop is slow and clunky. iTunes on the Mac is anything but.
It's been years since I used iTunes on Windows but at the time incredibly slow and clunky to the point of incompetence would have summed up my views on it. I wonder how it compares now to Spotify there.
On another note, Apple have a pretty good story with Airplay - does Spotify on iOS support that fully? On Android they don't support Chromecast and I've always thought that was an advantage of Play Music over Spotify - maybe there's an analogous situation on iOS?
On another note, Apple have a pretty good story with Airplay - does Spotify on iOS support that fully? On Android they don't support Chromecast and I've always thought that was an advantage of Play Music over Spotify - maybe there's an analogous situation on iOS?
Spotify app itself doesn't support AirPlay/Chromecast but some 3rd party apps allow you to stream Spotify to them.
On the other hand, Spotify has its own streaming protocol which is supported by a few player/speaker brands (e.g. Gramofon).
On the other hand, Spotify has its own streaming protocol which is supported by a few player/speaker brands (e.g. Gramofon).
You don't have to use the Spotify client; for example Clementine supports Spotify.
Really, these are the only reasons? Then it's even worse than I thought.
a) and c) are only relevant to Apple users. Spotify pretty much runs everywhere.
b) Watch for many is just a gimmick. This is really weak.
a) and c) are only relevant to Apple users. Spotify pretty much runs everywhere.
b) Watch for many is just a gimmick. This is really weak.
does Taylor Swift herself have full autonomy over determining how/when her music can be played?
That is a great question that I'm also curious to hear the answer. She seems to be signed with Universal, how come does she have fine-grained control over her publishing rights unlike most other artists? Or are these actually moves by the labels using her to earn sympathy from the public?
Ultra successful acts like Taylor Swift certainly don't just sign some standard contract the record label gives to them, but negotiate every single clause in it, using extremely competent and experienced managers and lawyers.
That's what distinguishes Taylor Swift from 95 percent of acts who maybe negotiate a little thing here and there, but are mostly happy to get signed.
That's what distinguishes Taylor Swift from 95 percent of acts who maybe negotiate a little thing here and there, but are mostly happy to get signed.
It's pretty likely she was able to negotiate control over her rights that most artists don't have, since she's one of the few remaining artists that actually sells records: http://www.npr.org/sections/therecord/2014/11/05/361577726/t...
She seems to be signed with Universal
No, she's signed with an indie label called Big Machine Records. Big Machine Records has a distribution deal with Universal.
No, she's signed with an indie label called Big Machine Records. Big Machine Records has a distribution deal with Universal.
I just posted about this at the top level, but thank you for being a critical thinker: Taylor Swift _may_ deal directly with a distributer but only because she's mega-ultra-super successful. 99% of musicians use third parties to get their music to distributors. You do not do deals directly with Spotify: you sign up with ASCAP and tell them the gist of where you want your music.
I'm honestly surprised there hasn't been antitrust action over this. Apple are trying to leverage one monopoly (iTunes Music Store for digital music sales) to gain a monopoly in another market (music streaming) by forcing unreasonable terms.
I guess this is also a reflection of the lack of political will for antitrust action. In my view, Apple has long been on thin ground with regards tying but there seems to be a lack of political will to use competition law.
I guess this is also a reflection of the lack of political will for antitrust action. In my view, Apple has long been on thin ground with regards tying but there seems to be a lack of political will to use competition law.
Everyone discussing this seems to take as fact that this is going to take away revenue from some other music distribution channel. In fact it could just as easily increase music consumption on the whole. If it does increase total royalties then it makes sense for the artists share the costs of promoting it through the 3 month free trial.
It's almost certainly not in Apple's interest to cannibalize their existing iTunes sales for the streaming service.
It's almost certainly not in Apple's interest to cannibalize their existing iTunes sales for the streaming service.
What Apple does is simply reprehensible. They say that since they will automatically switch everyone to the new service they are not willing to pay for them. People defending them would be pissed if Google did that with All Access. All services offer free trials and they all pay for the plays the get, and Google even has an offer for 60 days. Apple is rich and it should pay for the mistake of stalling and being a late comer.
I really don't like this idea that artists should be compensated for having their music listened to. I find it hurts the consumers, and it will hurt the artists in the long run. Basically, I don't think the concept of intellectual property works. What I believe is that artist should find a way to be compensated for the actual crafting of their work, and for the act of performing (Patreon is a great example of what I'd like to see more of).
Intellectual property wasn't a thing for most of human history. If you performed a song in public, anyone who heard it could write it down and perform it or do whatever they wanted to do with it. If you released something to the public, it belonged to the public, and legally that was that. And art still happened. Great art.
The idea that whoever made something owns it (and I really think it's absurd to own an idea) means that everyone else loses out. And I don't see how that can be good, even for the owner.
Intellectual property wasn't a thing for most of human history. If you performed a song in public, anyone who heard it could write it down and perform it or do whatever they wanted to do with it. If you released something to the public, it belonged to the public, and legally that was that. And art still happened. Great art.
The idea that whoever made something owns it (and I really think it's absurd to own an idea) means that everyone else loses out. And I don't see how that can be good, even for the owner.
This is about free access to a set of highly engineered content, which is not just a back catalogue you are trying to milk but your current latest creation.
We do not think that software engineers should be prohibited from charging for copies of their software: neither do we think that musicians should be prohibited for getting paid for their music.
Yes, people will continue to make art for free, because they love doing it. No, that has nothing to do with whether people are (implicitly) banned from charging for their art/labour if they want to.
We do not think that software engineers should be prohibited from charging for copies of their software: neither do we think that musicians should be prohibited for getting paid for their music.
Yes, people will continue to make art for free, because they love doing it. No, that has nothing to do with whether people are (implicitly) banned from charging for their art/labour if they want to.
Most software engineers (employees) are paid for crafting their software, not for having crafted in the past. That's exactly what I advocate for. We absolutely should pay people for working! I'm saying that those who distribute should be compensated for the distribution, and those who craft should be compensated for the crafting. And everyone should be free to do either, to the best of their abilities.
This is not true at all.
Many consultants may in fact be paid once. But most developers work at companies for a salary. That salary is paid for by charging for software over and over. Without being able to charge multiple times for the same piece of software, there would be no Microsoft, IBM, or Oracle, no SaaS, and no App Store, just to name a few, and none of the jobs that come along.
Many consultants may in fact be paid once. But most developers work at companies for a salary. That salary is paid for by charging for software over and over. Without being able to charge multiple times for the same piece of software, there would be no Microsoft, IBM, or Oracle, no SaaS, and no App Store, just to name a few, and none of the jobs that come along.
You're being deceptive, Fargren is on point. Once the dev leaves the company they no longer make that salary. Artists typically get paid some kind of royalty and don't give up full ownership of their work.
>Without being able to charge multiple times for the same piece of software, there would be no Microsoft, IBM, or Oracle, no SaaS, and no App Store
Good riddance.
>Without being able to charge multiple times for the same piece of software, there would be no Microsoft, IBM, or Oracle, no SaaS, and no App Store
Good riddance.
You're being deceptive
That's not very nice.
Who do you think owns SaaS businesses, or App Store apps, or downloadable software, etc.? I own a software company. If I couldn't resell my software over and over, I'd be homeless. If it couldn't sell software over and over, I'd have to fire all my employees (dev, customer support, marketing...) and shutter my business.
Do you think artists don't have employees? Is their music not their business? There's no difference between me owning software or an artist owning music.
Also, the companies you're saying "good riddance" to defined the world of selling software as a business and as a profession. You may think we'd be fine without them now, but not acknowledging the role they played is disingenuous at best - not to mention the literally hundreds of thousands of jobs they've created directly or indirectly.
That's not very nice.
Who do you think owns SaaS businesses, or App Store apps, or downloadable software, etc.? I own a software company. If I couldn't resell my software over and over, I'd be homeless. If it couldn't sell software over and over, I'd have to fire all my employees (dev, customer support, marketing...) and shutter my business.
Do you think artists don't have employees? Is their music not their business? There's no difference between me owning software or an artist owning music.
Also, the companies you're saying "good riddance" to defined the world of selling software as a business and as a profession. You may think we'd be fine without them now, but not acknowledging the role they played is disingenuous at best - not to mention the literally hundreds of thousands of jobs they've created directly or indirectly.
If I couldn't resell my software over and over, I'd be homeless.
I don't think you are being deceptive, but I suspect you are being facetious (hard tot ell in the internet). If you lived in a world where you couldn't resell your software, you'd have a different job that didn't depend on that. I imagine the people you provide value to would probably be willing to fund the development of the products they use. That is effectively what they are doing now, but they do it in a roundabout manner. If not all of them would(and there are game-theoretic reason why they probably shouldn't) maybe the ones that would could pay more, or maybe your product just wasn't worth so much to begin with (please don't take this as an affront to your product, I don't even know what it is).
Different property models lead to different viable businesses. I am saying I don't like the current model because it forbids certain endeavors I would love to see, and that we had before. Of course it would be harmful to some business plans that currently work. I just prefer the alternative.
I don't think you are being deceptive, but I suspect you are being facetious (hard tot ell in the internet). If you lived in a world where you couldn't resell your software, you'd have a different job that didn't depend on that. I imagine the people you provide value to would probably be willing to fund the development of the products they use. That is effectively what they are doing now, but they do it in a roundabout manner. If not all of them would(and there are game-theoretic reason why they probably shouldn't) maybe the ones that would could pay more, or maybe your product just wasn't worth so much to begin with (please don't take this as an affront to your product, I don't even know what it is).
Different property models lead to different viable businesses. I am saying I don't like the current model because it forbids certain endeavors I would love to see, and that we had before. Of course it would be harmful to some business plans that currently work. I just prefer the alternative.
But if they stop working, they are not paid anymore. They are effectively compensated for the act of working, not for some ownership over the work they've done.
But for most of human history, there weren't instant/digital cameras, digital recording devices, TVs, monitors, internets, instant and basically free copies, and so on. You want to see the latest Monet painting? There's only one way to do that. Want to make a very close copy of it? It's likely you're a bit of a genius yourself.
It's not that I think this model is perfect, but consuming art was difficult at best, expensive for much of history, and for large swaths of time, reserved for the rich.
If the exchange for extremely cheap and ubiquitous consumability is a model where artists get further compensated, I'm fine with that.
It's not that I think this model is perfect, but consuming art was difficult at best, expensive for much of history, and for large swaths of time, reserved for the rich.
If the exchange for extremely cheap and ubiquitous consumability is a model where artists get further compensated, I'm fine with that.
I agree that the model we had is probably not a perfect fit for our era. But the one we have wasn't designed for this time either. It is a combination of historical accident and strong lobbying for private interests that got us to this point. And while we do get extremely cheap and ubiquitous consumability, which is a good thing, we also get highly restricted redistribution, derivation and consumption.
What I believe is that we should have a system where everyone is free to distribute any form of media they have access to, and of any modifications he can make of that. Obviously, this would require a different form of compensation than the one we are using; if anyone can distribute, then charging for distribution is not a great idea. We should instead pay the produces for the act of producing (and the performers for the act of performing). This is not some crazy scheme by the way: this is exactly how we pay employees for software. We agree on a price for your skill, and pay you for as long as you excersize that skill.
Patreon and Kickstarter also work with similar models, compensating for the creative act before it is done (or directly afterwards).
What I believe is that we should have a system where everyone is free to distribute any form of media they have access to, and of any modifications he can make of that. Obviously, this would require a different form of compensation than the one we are using; if anyone can distribute, then charging for distribution is not a great idea. We should instead pay the produces for the act of producing (and the performers for the act of performing). This is not some crazy scheme by the way: this is exactly how we pay employees for software. We agree on a price for your skill, and pay you for as long as you excersize that skill.
Patreon and Kickstarter also work with similar models, compensating for the creative act before it is done (or directly afterwards).
Throughout most of human history there was also no way to listen to a specific artist unless you attended their live performance. Since technology has made the impossible possible, it shouldn't surprise anyone that new social contracts have also been created around it.
What is fundamentally wrong with a model that essentially works as, "You make money when we make money"? Meanwhile, both sides are contributing resources to the trial - musicians the content, Apple the back-end and a gazillion users. Seems like a pretty fair deal with aligned interests. Apple does not have a moral obligation to use this as a loss leader just because they make a lot of money while many musicians don't...this isn't a charity.
Taylor Swift is a blowhard. I'm tired of her holier-than-thou rhetoric that she's just speaking up on half of other musicians. Yeah right...my bs detector is going bonkers. This is about Taylor Swift (and the idiots involved in the laughable TIDAL) maximizing her earnings, which is perfectly fine. But spare me the music industry's equivalent of "won't someone think of the children?!"
Taylor Swift is a blowhard. I'm tired of her holier-than-thou rhetoric that she's just speaking up on half of other musicians. Yeah right...my bs detector is going bonkers. This is about Taylor Swift (and the idiots involved in the laughable TIDAL) maximizing her earnings, which is perfectly fine. But spare me the music industry's equivalent of "won't someone think of the children?!"
This isn't the first time Apple has screwed over independent/small content producers (HN 1682 days ago): https://news.ycombinator.com/item?id=1896189
In theory, negotiations over royalties would be simply bargaining over some number, like a percentage of revenue or dollar value per song played. In practice, it involves all sorts of weird deals like this free trial. But ultimately, this is just about how much money musicians get for their music. It is no different to negotiations that determine the price of steel or wool. The only reason that these deals attract so much publicity is that people like musicians because they are so cool and beautiful. When people have a cool head, most can see that this is a matter between the musicians and the company, and no one else has a practical or ethical reason to be involved.
The Apple Music free trial thing is shitty but Taylor seems quite out of touch with the shape of the industry here.
Taylor Swift can withhold her music from streaming services because she's a PHENOMENON who can still shift albums via iTunes (and even physically) because people want her music. Artists starting out don't have that luxury and, increasingly, their music won't get the listens if it's not on streaming services.
It strikes me as similar to the situation with people only buying games that are on Steam. Consumers love the convenience of a platform that is in many ways quite anti-creator. Tough one.
Taylor Swift can withhold her music from streaming services because she's a PHENOMENON who can still shift albums via iTunes (and even physically) because people want her music. Artists starting out don't have that luxury and, increasingly, their music won't get the listens if it's not on streaming services.
It strikes me as similar to the situation with people only buying games that are on Steam. Consumers love the convenience of a platform that is in many ways quite anti-creator. Tough one.
Taylor Swift can withhold her music from streaming services because she's a PHENOMENON who can still shift albums via iTunes (and even physically) because people want her music. Artists starting out don't have that luxury and, increasingly, their music won't get the listens if it's not on streaming services.
Did you read the post where she explains what is her goal for doing this? Here is the relevant part:
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.
Did you read the post where she explains what is her goal for doing this? Here is the relevant part:
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.
Do you really believe that? Or is that maybe carefully crafted language to fend off the parent's valid argument?
Plenty of creators currently put their music on Soundcloud, Bandcamp, Youtube and more, and get exposure that way without getting paid.
The choice is really up to the artist. I do agree that Apple has the ability to pay artists during the 3-month trial, but should they have to? I don't know..
btw not saying I have the answer here, but as parent said, the current landscape doesn't really line up with her argument much.
Plenty of creators currently put their music on Soundcloud, Bandcamp, Youtube and more, and get exposure that way without getting paid.
The choice is really up to the artist. I do agree that Apple has the ability to pay artists during the 3-month trial, but should they have to? I don't know..
btw not saying I have the answer here, but as parent said, the current landscape doesn't really line up with her argument much.
> I do agree that Apple has the ability to pay artists during the 3-month trial, but should they have to?
Unless the artist (or representative) have given them permission to use their content for free, they should absolutely have to. It's the same IP laws that Apple like to use in their own defence: you can't just use someone else's stuff without their permission and without remuneration. What do you think Apple would do to me if I started selling an OS that used Apple's graphics set?
Just because some artists put their music on free media doesn't mean that a corporation can use that music as a loss-leader to sell their service.
Unless the artist (or representative) have given them permission to use their content for free, they should absolutely have to. It's the same IP laws that Apple like to use in their own defence: you can't just use someone else's stuff without their permission and without remuneration. What do you think Apple would do to me if I started selling an OS that used Apple's graphics set?
Just because some artists put their music on free media doesn't mean that a corporation can use that music as a loss-leader to sell their service.
But is Apple planning to use the content without permission? It doesn't seem to be the case, since they're contacting artists asking them to join Apple Music. There was a guy claiming they threatened kicking him off iTunes, but they've denied it.
> This is about the new artist or band that has just released their first single and will not be paid for its success.
That's how the music business has always worked. With a few exceptions labels take a loss on the startup costs of establishing new artists.
That's how the music business has always worked. With a few exceptions labels take a loss on the startup costs of establishing new artists.
"Taylor seems quite out of touch with the shape of the industry here."
She is VERY in touch with its shape... And she is trying to change it. She also famously ditched Spotify and has been consistent in using her fame and leverage.
What she is doing is very important...Spotify is bankrupting artists while bleeding cash with no real business model to make the money back. She was outlasting them while the vc money ran out and it was working.... Now that Apple is in the game, the danger of them using their cash to bankrupt artists with a bad business almost indefinitely is very scary to artists. She is trying to be diplomatic while making a point.
She is VERY in touch with its shape... And she is trying to change it. She also famously ditched Spotify and has been consistent in using her fame and leverage.
What she is doing is very important...Spotify is bankrupting artists while bleeding cash with no real business model to make the money back. She was outlasting them while the vc money ran out and it was working.... Now that Apple is in the game, the danger of them using their cash to bankrupt artists with a bad business almost indefinitely is very scary to artists. She is trying to be diplomatic while making a point.
Taylor is pulling her music because those small artists can't. She's making a statement, and because she's such a phenomenon her statement is likely to at least be heard.
I find this hopelessly naive. Yes she said that. Why is she only pulling 1989? Not her other albums? It seems the most likely true answer is "because that one is still selling strong so it is in her interests to do so."
Because that is the one streaming services are most interested in getting so it gives her the most leverage.
It's also very possible that Swift doesn't have control over where the other albums appear, since they're from old deals she made before she had much leverage.
Most likely, it's a combination of all three possible explanations: some albums are from old deals she has no control over, others (1989) she wants to make more money on, and she's also disgusted with Apple's treatment of artists and taking a stand.
People don't need a single pure motivation for their actions to be legitimate.
Most likely, it's a combination of all three possible explanations: some albums are from old deals she has no control over, others (1989) she wants to make more money on, and she's also disgusted with Apple's treatment of artists and taking a stand.
People don't need a single pure motivation for their actions to be legitimate.
> [Steam] a platform that is in many ways quite anti-creator
Without wanting triggering an argument here...would you mind giving me a 3 sentence summary of what aspect of it is anti-creator?
Without wanting triggering an argument here...would you mind giving me a 3 sentence summary of what aspect of it is anti-creator?
A number of developers have been complaining (unreasonably, IMO) about the recent refund policy. Oh, and there's the 30% cut which can be seen as a bit too high.
Otherwise, I would also be genuinely curious to hear what problems developers have with Steam.
Otherwise, I would also be genuinely curious to hear what problems developers have with Steam.
I believe that Netflix pays content providers for the views on their 1 free month.
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If you don't need the promotion hold your music off for 3 months. If you do, go for it. Problem solved?
Maybe there was some sort exclusivity thing but it doesn't make sense that artists would have to take it or leave it now.
Also, someone with her streaming numbers is basically the only kind of artist that would even care. Streaming royalties are really low unless you have really huge numbers so while she stands to potentially lose significant revenue in 3 months tons of artists won't.
Maybe there was some sort exclusivity thing but it doesn't make sense that artists would have to take it or leave it now.
Also, someone with her streaming numbers is basically the only kind of artist that would even care. Streaming royalties are really low unless you have really huge numbers so while she stands to potentially lose significant revenue in 3 months tons of artists won't.
It's difficult to know for sure but reasonable to assume that at least some of the people streaming for free would have bought the album instead.
Apple put themselves in a comfortable spot here. They generously offer a trial period, but then they make sure someone else pays for it (the artists). And the people paying the costs don't even have a say in it, except the obvious “my way or the highway” choice of using Apple at all.
Fascinating how Apple can make every cent of cash end up in their own register, but the people paying for this optimisation are the “partners” in the middle between Apple & the consumer.
Fascinating how Apple can make every cent of cash end up in their own register, but the people paying for this optimisation are the “partners” in the middle between Apple & the consumer.
No one seems to have said this yet, but I wonder if Apple has done the following math:
expected negative value of bad pr = NPR
loss of customers from artists pulling songs = CUS
Cost of running PR Campaigns combating these stories = PR
Cost of paying artists for 3 month trial = TRIAL
Other forgotten costs = COSTS
If(NPR + CUS + PR) is greater than (TRIAL + COSTS) they should just pay the artists and make this go away. Obviously this is a very simplified example, but I wonder if Apple has done this sort of appraisal. I suspect they have.
expected negative value of bad pr = NPR
loss of customers from artists pulling songs = CUS
Cost of running PR Campaigns combating these stories = PR
Cost of paying artists for 3 month trial = TRIAL
Other forgotten costs = COSTS
If(NPR + CUS + PR) is greater than (TRIAL + COSTS) they should just pay the artists and make this go away. Obviously this is a very simplified example, but I wonder if Apple has done this sort of appraisal. I suspect they have.
Are there any SaaS services that take care of hosting, selling, billing etc that small bands can use? May be the SaaS app can take 10% of the sales or something like that (like udemy, but for music)? If there are, what are the reasons the smaller bands aren't using them?
If at the end, Apple/Google/Amazon/Microsoft replace the record labels and become the new overlords of music, then nothing much has changed, right?
If at the end, Apple/Google/Amazon/Microsoft replace the record labels and become the new overlords of music, then nothing much has changed, right?
Why so many people blame apple? For the beloved Tayloer? Or for the beloved Music industry?
I still don't get it. Today's music pretty much sucks, I mean the artists mostly didn't even make their own music, they just buy the text and everything. Most music of today costs way less than it costed years before and still isn't that great, it's just for the masses and yet artists are crying cause they get not enough? Huh 10 $ per month is a lot especially when you think about it, a normal person won't buy an album every month which costs nearly 10 $ per month.. Also why should an artist live with a single hit for his whole life? That makes no sense.
People in this business don't live in the reality, I mean more and more films happen to be on streaming platforms, yet a film costs way more to produce than music and still you pay the same price for netflix / amazon instant video / etc than for a music streaming service.
Also why does an album online costs as much as an album inside the store?? Thats way out of reality.
People should stop buying everything from labels, artists, just to show them what they do today is not funny anymore.
P.S.: And i don't get it why she has so many fans. Hell her music is way worse than a lot of pop music I listened so far. Why can't we have great artists today? Nobody remembers the good old days of The Who, Queen, Redbone, Blue Swede, etc.. Too bad what happens to music these days..
I still don't get it. Today's music pretty much sucks, I mean the artists mostly didn't even make their own music, they just buy the text and everything. Most music of today costs way less than it costed years before and still isn't that great, it's just for the masses and yet artists are crying cause they get not enough? Huh 10 $ per month is a lot especially when you think about it, a normal person won't buy an album every month which costs nearly 10 $ per month.. Also why should an artist live with a single hit for his whole life? That makes no sense.
People in this business don't live in the reality, I mean more and more films happen to be on streaming platforms, yet a film costs way more to produce than music and still you pay the same price for netflix / amazon instant video / etc than for a music streaming service.
Also why does an album online costs as much as an album inside the store?? Thats way out of reality.
People should stop buying everything from labels, artists, just to show them what they do today is not funny anymore.
P.S.: And i don't get it why she has so many fans. Hell her music is way worse than a lot of pop music I listened so far. Why can't we have great artists today? Nobody remembers the good old days of The Who, Queen, Redbone, Blue Swede, etc.. Too bad what happens to music these days..
Given the volume cap of Apple and the formulas they can pop out stating "after three months of free use, x users will convert into paying users resulting in y revenu and z profit for you" to record labels, all it boils down is record labels willing to believe Apple their predictions and whether they are happy with that y in return of 3 months of upfront payment.
Taylor et. al. don't seem to understand. Apple controls the marketplace and is a legal monopoly, owning the software AND hardware. If you don't like what Apple does, tough luck. Whining about it has never amounted to anything and nobody is going to replace them. Long live the King.
[ now picture me killing myself by slitting my throat with an Air ]
[ now picture me killing myself by slitting my throat with an Air ]
Taylor doesn't seem to care at all - "[...] can support myself, my band, crew, and entire management team by playing live shows."
Apple should just pay royalties out of their own, enormous pockets of $172B (our whatever it was) for the first three months, just not charge users. Then there wouldn't be a problem. What they're doing now is just strong-arming weaker parties to create a platform that will increase their own power even more.
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Before everyone brings out the pitchforks, I feel we may not have the full picture. According to her tumblr post, it's unclear if it's non-payment or deferred payment for streaming her songs during the three month trial period.
Why is everyone complaining about the deal? Did Apple force all of the artists into it or did the record companies? Either way, the problem doesn't come from the terms of the deal, it comes from why the deal was made.
Apple needs to loosen their purse strings and give back a little. I can't believe I'm standing up for the music industry, but Apple wouldn't be half the company they are today without music.
It's a sales move of apple to get people to use their product, and immediately make it paying to get new subscribers.
It's crazy how the industry leaders are so prevalent compared to the people they employ.
It's crazy how the industry leaders are so prevalent compared to the people they employ.
Taylor can easily get on radio playlists. Unknown artists cannot. They CAN get on Apple music, spotify, etc. There's no way to get known beyond local clubs without the free exposure.
Yes, unknown artists can't, but the point is that they are going 3 months without income. There have been many local one-hit-wonders in my country, make a decent album with one or two 'hit' singles, and never get enough money to stay afloat. Hence the one-hit-wonder bit.
If it took me 6 months of no income to produce an album, then as I release it I go 3 months with no income (assuming that Apple is the only streaming service, and that people choose to stream instead of buy). By the time the 3 months are over, people have moved on to something else. This hurts me as I don't recover my expenses.
Taylor mentioned that she can support herself, team, etc. The unknown mostly can't, so the trial hurts them.
If it took me 6 months of no income to produce an album, then as I release it I go 3 months with no income (assuming that Apple is the only streaming service, and that people choose to stream instead of buy). By the time the 3 months are over, people have moved on to something else. This hurts me as I don't recover my expenses.
Taylor mentioned that she can support herself, team, etc. The unknown mostly can't, so the trial hurts them.
Make great music. Give it away for free (or streaming, which is near the same). Charge a lot for live concerts. I'd just assumed that musicians would have figured that out by now.
The 'free' bit has already happened for a lot of artists (income is gone). The second part 'charge a lot for live music' is happening - those who can are try to compensate (i.e. make a living).
Having just paid over $100 for a concert ticket, I don't think live music becoming only the preserve of the rich helps.
I expect that we will soon see some "hybrid" approaches. VR/AR tech comes to mind. I would have liked to have seen the Stones last night, but $200-400 for a ticket was more than I could justify. But if I could watch in comfort from my home holodeck, then I'd certainly have been willing to pay $50.
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And they say Apple cares about artists and content creators...
Damn, I hate Apple. And Google, Facebook, Microsoft, Amazon. Oh yeah, they want to make the world a better place, those sneaky bastards.
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hmm ... seems Taylor Swift is not much better:
https://junction10.wordpress.com/2015/06/21/those-in-glass-h...
https://junction10.wordpress.com/2015/06/21/those-in-glass-h...
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Obviously Apple can afford to pay money out to the recording artists and labels for the free trial if they wanted to, but I wonder if the decision not to is related to setting a precedent. Like if they were to compensate all the artists $X per day of availability then that would be a sort of legal benchmark that could come back to haunt them.
Of course. They['re trying to shift risk onto the creator. Now in fairness, Apple has put a lot of capital at risk by building the streaming infrastructure and so on for the service to work reliably and be considered a 'world class' product like their other offerings. On the other hand. Apple is arguably sitting on top of the world's largest cash pile so the ratio of capital-at-risk relative to their capital cushion is a lot different from that of 99% of musicians.
"we don't ask you for free iphones" it's something
I respect this woman more every time I hear about her in the news. I'm glad to see a huge player try to stand up for others like that. It's remarkable considering she clearly understands she could end up helping someone that takes a sale from her.
How much you paying to publish on tumblr Taylor?
I find it difficult no to love this young girl.
I'm still kinda surprised that artists expect to get paid when they're not performing. Anything they get from Apple Music's sort of service is a bonus.
this sucks but it's not a new technique
music clubs of 15 years ago didn't pay artists for your "12 free CDs" either
music clubs of 15 years ago didn't pay artists for your "12 free CDs" either
made me think about those old BMG (i think it was) music clubs were you could purchase 12 CDs for 3 cents, and all you had to do is buy x amount of CDs per year. Wonder if the artist got paid for those.
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What stops her from joining after the 3 month trial period?
Everyone who signs up has 3 months free trial from that day, not that the first 3 months of the service (since it goes live) are free for everyone.
Still, she could join in once a desired number of users finished their trial period and started paying.
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Apple made their response to this a few days ago in this Recode article. http://recode.net/2015/06/15/heres-what-happens-to-your-10-a...
>Apple won’t pay music owners anything for the songs that are streamed during Apple Music’s three-month trial period, a bone of contention with music labels during negotiations for the new service. But Kondrk says Apple’s payouts are a few percentage points higher than the industry standard, in part to account for the lengthy trial period; most paid subscription services offer a free one-month trial.
I wonder if all of these complaints would go away if Apple said they weren't going to offer higher payouts overall but would pay during the free-trial?
>Apple won’t pay music owners anything for the songs that are streamed during Apple Music’s three-month trial period, a bone of contention with music labels during negotiations for the new service. But Kondrk says Apple’s payouts are a few percentage points higher than the industry standard, in part to account for the lengthy trial period; most paid subscription services offer a free one-month trial.
I wonder if all of these complaints would go away if Apple said they weren't going to offer higher payouts overall but would pay during the free-trial?
"Higher payouts" appear to be 71 (US) and 73% (rest of the world) vs. 70% from Spotify [0] (and likely very similar from other streaming services).
1% is a hilariously small amount to push expectations on artists without even asking.
[0] http://www.theguardian.com/music/2015/jun/18/beggars-group-s...
1% is a hilariously small amount to push expectations on artists without even asking.
[0] http://www.theguardian.com/music/2015/jun/18/beggars-group-s...
And a 3 month free trial is a hilariously short period of time they won't be getting paid in the grand scheme of things. Aside from our characterizations of what is "hilariously small", the fact is that the major labels saw that the deal was worth it to them. And if any of these complaining labels were put to the test as to which deal they would prefer, (paid during free trial and industry standard rates or no payment during free trial and higher than industry rates) I'm pretty sure they're going to pick the latter.
Not for non-signed artists, which Apple played up pretty hard at WWDC. They don't have labels negotiating for them - in fact, they were left out of the negotiation altogether.
But in any case, now artists have two large organizations worried about themselves between the artist and the consumer.
This is better, how?
But in any case, now artists have two large organizations worried about themselves between the artist and the consumer.
This is better, how?
I'm not sure what difference it makes that they don't have labels? The deal is the same for everyone, you get higher royalties overall in exchange for the 3 month free trial.
Of course large labels can handle this. Small artists that rely on month-to-month revenue to live suffer when they have to give their product away for 3 months. If you give away swag at an event to promote your business with your logo, I bet you still paid the manufacturers and printers and shippers and...
And this isn't a "new" business opportunity. It's very likely many subscribers will come Spotify or Rdio or other service, so it isn't a full net plus. Revenue from other avenues will go down.
And this isn't a "new" business opportunity. It's very likely many subscribers will come Spotify or Rdio or other service, so it isn't a full net plus. Revenue from other avenues will go down.
They aren't giving away their product, they're getting higher royalties overall. Your argument makes sense only if every single artist is going to be releasing a new album during this 3 month trial period, and that everyone that subscribes to Apple Music does so when it launches. That's not going to happen and musicians will release music long after the trial period is over, for which they'll be earning a higher royalty.
The deal isn't the same for everyone. The big record labels have individually negotiated deals with Apple Music.
It would take nine years to make up that three month trial period on a 1% extra basis, not accounting for time value of money. They are not hilariously small/short on the same scale. And that doesn't even account for how artists are non-uniformly affected -- artists who are popular now are boned, whereas if you're popular in five years it's no big deal.
That's disingenuous; other streaming services pay for streams by free users.
What's disingenuous about it? If Apple said that they'd pay during the free-trial but went back to the same industry standard rates would any of these artists still be complaining? I don't think so, they stand to benefit more overall from a service that will offer them higher payouts than the payment they get during the free-trial. The artists/labels complaining would obviously prefer that Apple offer the higher payout AND pay them during the trial, but that's why this is nothing more than a business negotiation being played out in public.
The fact is that Apple is paying for music during the free-trial, in higher and on-going payments.
The fact is that Apple is paying for music during the free-trial, in higher and on-going payments.
> it is unfair to ask anyone to work for nothing
Does she really think that she works for every digital copy of a recording? Or that there is a relation between the work needed to produce a recording and the number of copies she sells?
Does she really think that she works for every digital copy of a recording? Or that there is a relation between the work needed to produce a recording and the number of copies she sells?
Apple should keep the free trial, but pay revenue only to artists who aren't multi-millionaires or extremely popular.
Then when Taylor still refuses to let iTunes sell her music she'll be seen for what she really is.
Then when Taylor still refuses to let iTunes sell her music she'll be seen for what she really is.
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It seems people dislike the truth of your comment.
overall, it is interesting to see pure market forces at play here.
revenues with computer games and movies are going up, revenue with music is going down.
the consumer does not value music that much, plus there is so much musical content which further depresses value.
the historic anomaly of high priced musical reproduction/media is over. back to normal.
revenues with computer games and movies are going up, revenue with music is going down.
the consumer does not value music that much, plus there is so much musical content which further depresses value.
the historic anomaly of high priced musical reproduction/media is over. back to normal.
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taytay
FU Pay Me!
Oh why are we peddling to whining by people who have too much money and airtime already?
Because they're powerful and can make excellent allies if they so choose.
Here is why apple sold Taylor for free:
Taylor is Swift; Swift is free; So Taylor is free too.
Taylor is Swift; Swift is free; So Taylor is free too.
I think T-Swift just needs to "Shake it off, Shake it off..."
I guess I was the only one who thought this was going to be Taylor Swift complaining that they named a programming language after her (before reading this) and putting a trademark on her last name (or something similarly silly).
I get the free trial.. but not paying the artists? really?
This feels very high and mighty of Apple. Hate to break it to you Apple but you are not changing the music industry like you did with iTunes. Streaming music services have been around for years. This isn't some revolutionary new product that artists just have to be on board with. There are other options.
This feels very high and mighty of Apple. Hate to break it to you Apple but you are not changing the music industry like you did with iTunes. Streaming music services have been around for years. This isn't some revolutionary new product that artists just have to be on board with. There are other options.
> These are not the complaints of a spoiled, petulant child.
I am starting to doubt that Taylor Swift really is as 'representative' as she wishes to portray, and not simply greedy, considering the extent to which she avoids non-profit-maximising revenue streams (e.g. Spotify).
I am starting to doubt that Taylor Swift really is as 'representative' as she wishes to portray, and not simply greedy, considering the extent to which she avoids non-profit-maximising revenue streams (e.g. Spotify).
That is literally her choice to make, as it's her name and her work that's being sold here. And good for her (and her management team, and her management team's management team) for making it.
Well, the same argument of "This is a terrible thing for up-an-coming (or niche) artists" could be made against Spotify's business model.
And slightly off-topic, I fail to see how anyone could call any of this the complaints of a spoiled child even if she would flat out say "fuck you, pay me". Are you not allowed to ask for your dues if you're rich already?
And slightly off-topic, I fail to see how anyone could call any of this the complaints of a spoiled child even if she would flat out say "fuck you, pay me". Are you not allowed to ask for your dues if you're rich already?
> ..she avoids non-profit-maximising revenue streams
Like someone running a business you mean?
Like someone running a business you mean?
She avoids Spotify because they wouldn't let her music be only available for paying users.
Basically, she refuses to be ad-supported, or give her music away.
Basically, she refuses to be ad-supported, or give her music away.
Well that's not entirely true, since her music is available on YouTube.
Doesn't that logic mean she should pull her music from all radio stations?
How is wanting to be paid being "greedy?" Give me 10% of your salary please. If you refuse, it's clear you're just greedy.
She's a startup.
> Three months is a long time to go unpaid, and it is unfair to ask anyone to work for nothing.
It is safe to assume that max. 10% of the subscribers will be in this 3 month trial. You will make money from the other 90%.
Also, just a little industry insight: Taylor makes $1.5m+ at each concert, plus travel, hotel, technical rider. I have a very hard time understanding all this cry baby talk.
It is safe to assume that max. 10% of the subscribers will be in this 3 month trial. You will make money from the other 90%.
Also, just a little industry insight: Taylor makes $1.5m+ at each concert, plus travel, hotel, technical rider. I have a very hard time understanding all this cry baby talk.
If you made it to that line you already read her explanation of that and her saying that she makes enough from live performances.
That money pays a lot of other peoples salaries too. It takes a large staff to put on a tour for a performer of her size.
That money pays a lot of other peoples salaries too. It takes a large staff to put on a tour for a performer of her size.
So you obviously didn't read TFA then. Like the second or third sentence in clearly states that she is not doing this for herself but for all of the smaller artists who don't have the power to make a stand like this.
You have any data to support that?
And if that's true, then Apple should be taking the hit up front, not the artists.
Your last point is just irrelevant and unnecessary.
And if that's true, then Apple should be taking the hit up front, not the artists.
Your last point is just irrelevant and unnecessary.
I worked in the live music industry and have a pretty good idea of these numbers. But you can just google up some leaked booking agreements (The Smoking Gun has some pdfs).
Yes, obviously a lot of people must be paid from that fee (crew, management, band...), but it is still shitload of cash.
Yes, obviously a lot of people must be paid from that fee (crew, management, band...), but it is still shitload of cash.
What did you do? Because it seems like you're pretty dramatically underestimating the cost of a stadium tour and confusing costs for a tour with payments for private bookings(separating travel expenses for example which would come from the artist on a tour).
> This is about the new artist or band that has just released their first single and will not be paid for its success.
Did you read the whole article?
Did you read the whole article?
So, because she's successful, she should roll over and forgo one of her income steams? If she truly believes this Apple deal will hurt her bottom line, or the bottom line of other content creators, she has a legitimate complaint.
> Tomorrow, Apple announces that it will be introducing an "App Store Subscription." For $9.99/month users will receive unlimited access to all apps on the App Store. Developers will receive a share of each user's subscription payments in proportion to app usage. Apple simultaneously announces a 3 month free trial for all App Store accounts, and states that it will be making no payments to developers during that trial since users are not paying for it.
I, personally, would ditch iOS development for Android in a heartbeat if that happened. I can't blame musicians for having a similar reaction.