Analysis

AIM refuses to endorse Apple Music deal for indie labels


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Is Apple Music really going to launch on 30 June with many prominent indie labels missing? The prospect is looking ever closer, with British indie body AIM yesterday warning its members off the deal currently being offered by Apple – joining its US counterpart A2IM in that view.

“Having now had over a week to reflect on the launch of Apple Music we are not satisfied that the deal being offered under this new initiative is fair or equitable to independent music companies,” wrote AIM boss Alison Wenham in a letter to members.

She went on to admit that Apple Music has “great potential” to “help further develop existing streaming markets and open up new ones around the world”, but as in A2IM’s case the main issue is Apple’s desire to not pay royalties for the three-month free trial of its new service.

“The main sticking point is Apple’s decision to allow a royalty free, 3-month trial period to all new subscribers,” wrote Wenham. “This is a major problem for any label that relies on new releases rather than deep catalogue as the potential for this free trial to cannabalize not only download sales, which remain a very important revenue stream, but also streaming income from other services, is enormous.”

Apple says it has signed deals with several large independent labels, but with a revision of its trial-payout plans unlikely, it seems Apple Music may be missing some prominent independent artists from its on-demand tier, at least, when it goes live at the end of the month.

Comments made by licensing agency Merlin’s boss Charles Caldas to Music Ally earlier this month – “I think people will notice the cost of Apple getting into the streaming business with those major labels” – come to mind at this point, as do the claims by Merlin and others that indie labels have been punching above their traditional market-share weight on streaming services like Spotify.

Stuart Dredge

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