Artists are paid more on Apple Music than Spotify, Apple said in a letter the Wall Street Journal received on Friday. A few months after its main competitor, Apple’s music streaming service has finally announced its artist compensation.
The policy is the same for all artists, without exception, according to the words of the brand with the apple. “We believe in paying the same price to every creator,” she wrote before adding, “As the discussion of streaming royalties continues, we feel it is important to share our values.”
How Much Do Artists Make From Apple Music?
This notion of equality is a very complex topic for platforms. With the music industry working today, it is not possible for the services to pay the artist directly. Apple Music and Spotify pay the license fees to the rights holders, who then pay the artist a certain percentage based on his negotiated contract. The majority of the funds therefore remain with the distributor, the label, the record company …
To address this issue, Apple and Spotify state that they are paying rightsholders based on their contract with the artist (SoundCloud recently joined this policy). The lower the shares negotiated for artists, the more platforms rightsholders pay, so that artists can receive the same amount as independent artists, for example. Apple Music says it pays back 1 cent, or $ 0.01 per stream (one listen).
Compared to Spotify, the amount would be twice as high. Spotify is expected to pay artists $ 0.005, which is half that. On the flip side, the platform remains the most influential in the market and contributes the most to the music industry as it has more users (155 million paying users out of a total of 325 million versus 60 million for Apple according to its June 2019 numbers).
However, Spotify and Apple Music are good indicators of the huge share of record companies in the music industry. In its letter, Apple said that 52% of its subscription revenue went into the pockets of record companies. At Spotify, artist rights holders would receive 2/3 of every dollar paid by the platform. Artists always belong to the last remaining percentages.