Apple's New Music Royalty Proposal Would Make Streaming Costlier for Free Services Like Spotify

Apple has submitted a proposal to the U.S. Copyright Royalty Board calling for a simplified way to pay songwriters and music publishers for streaming music, according to Billboard. While the change would benefit labels, artists and publishers, it would make it more difficult for streaming services like Spotify to continue offering free tiers.

applemusic

Apple, which has always had a gift for creative simplicity, wants to make this process easier and more transparent, according to a copy of the filing obtained by Billboard. The company’s proposal to the Copyright Royalty Board suggests a simple, “all-in” statutory rate that would be “fair, simple and transparent, unlike the incredibly complicated structure that currently exists.”

Apple's suggested rate is 9.1 cents per 100 plays, which would make the songwriting royalties for 100 streams equal to the royalties for a single song download. However, the change would make it more expensive for companies like Spotify and YouTube to offer free music tiers.

The current system sees streaming companies paying songwriters and publishers between 10.5 and 12 percent of their revenue using what Billboard terms a "complicated formula." The money is then divided into public performance and mechanical royalties, which is then paid to publishers and "collected societies." Currently, Apple and other streaming music providers don't have to pay publishers the statutory rate set by the Royalty Board because they can negotiate their own deals. However, negotiations between publishers and streaming services would start at a different place should Apple's proposal become rule.

The Copyright Royalty Board, which is made up of a panel of three judges, is still in the early stages of determining potential statuary rates for 2018 to 2022 so it's unclear whether Apple's proposal would take hold or ever come to be.

While Apple Music has garnered about 15 million paying subscribers in the year since its launch, rival Spotify has twice as many, with the company citing Apple's entrance into paid music streaming as a boon to its business. Despite user and revenue growth, Spotify continues to operate at a loss due to expensive royalties and revenue sharing with music labels, with recent losses growing 10 percent to $195.7 million.

Popular Stories

AirPods Pro 3 Mock Feature

AirPods Pro 3 Just Months Away – Here's What We Know

Friday April 18, 2025 5:16 am PDT by
Despite being more than two years old, Apple's AirPods Pro 2 still dominate the premium wireless‑earbud space, thanks to a potent mix of top‑tier audio, class‑leading noise cancellation, and Apple's habit of delivering major new features through software updates. With AirPods Pro 3 widely expected to arrive in 2025, prospective buyers now face a familiar dilemma: snap up the proven...
iphone 16 pro models 1

17 Reasons to Wait for the iPhone 17

Thursday April 17, 2025 4:12 am PDT by
Apple's iPhone development roadmap runs several years into the future and the company is continually working with suppliers on several successive iPhone models simultaneously, which is why we often get rumored features months ahead of launch. The iPhone 17 series is no different, and we already have a good idea of what to expect from Apple's 2025 smartphone lineup. If you skipped the iPhone...
Beyond iPhone 13 Better Triad

Apple's 20th Anniversary iPhone May Finally Go All Screen

Tuesday April 15, 2025 6:31 am PDT by
Apple is preparing a "bold" new iPhone Pro model for the iPhone's 20th anniversary in 2027, according to Bloomberg's Mark Gurman. As part of what's being described as a "major shake-up," Apple is said to be developing a design that makes more extensive use of glass – and this could point directly to the display itself. Here's the case for Apple releasing a truly all-screen iPhone with no...
maxresdefault

iPhone 17 Pro Launching Later This Year With These 12 New Features

Sunday April 13, 2025 7:52 am PDT by
While the iPhone 17 Pro and iPhone 17 Pro Max are not expected to launch until September, there are already plenty of rumors about the devices. Subscribe to the MacRumors YouTube channel for more videos. Below, we recap key changes rumored for the iPhone 17 Pro models as of April 2025: Aluminum frame: iPhone 17 Pro models are rumored to have an aluminum frame, whereas the iPhone 15 Pro and ...
CarPlay Hero

Apple Releases Wireless CarPlay Fix

Wednesday April 16, 2025 11:28 am PDT by
If you have been experiencing issues with wireless CarPlay in your vehicle lately, it was likely due to a software bug that has now been fixed. Apple released iOS 18.4.1 today, and the update's release notes say it "addresses a rare issue that prevents wireless CarPlay connection in certain vehicles." If wireless CarPlay was acting up for you, updating your iPhone to iOS 18.4.1 should...
iOS 18

iOS 18.5 Includes Only a Few Changes So Far

Monday April 21, 2025 11:00 am PDT by
Apple seeded the third beta of iOS 18.5 to developers today, and so far the software update includes only a few minor changes. The changes are in the Mail and Settings apps. In the Mail app, you can now easily turn off contact photos directly within the app, by tapping on the circle with three dots in the top-right corner. In the Settings app, AppleCare+ coverage information is more...
top stories 2025 04 19

Top Stories: iPhone 17 Pro Rumors, CarPlay Bug Fix, and More

Saturday April 19, 2025 6:00 am PDT by
This week saw rumor updates on the iPhone 17 Pro and next-generation Vision Pro, while a minor iOS 18.4.1 update delivered not just security fixes but also a fix for some CarPlay issues. We also looked ahead at what else is in Apple's pipeline for the rest of 2025 and even the 20th-anniversary iPhone coming in 2027, so read on below for all the details on these stories and more! iPhone 17 ...
ipad air windows 11 arm

M2 iPad Air Runs Windows 11 ARM via Emulation, Thanks to EU Rules

Tuesday April 22, 2025 5:01 am PDT by
A developer has demonstrated Windows 11 ARM running on an M2 iPad Air using emulation, which has become much easier since the EU's Digital Markets Act (DMA) regulations came into effect. As spotted by Windows Latest, NTDev shared an instance of the emulation on social media and posted a video on YouTube (embedded below) demonstrating it in action. The achievement relies on new EU regulatory...

Top Rated Comments

Junipr Avatar
115 months ago
Apple's lawyers are working harder than their engineers on this product
Score: 59 Votes (Like | Disagree)
AppleScruff1 Avatar
115 months ago
Sounds simpler and fairer; kicking Spotify and Google is just an added side bonus ;-)
Yeah, it will be much better for the consumer when they have a choice of Apple or Apple. We know how Apple loves to pass on the savings to their loyal followers.
Score: 53 Votes (Like | Disagree)
daabido Avatar
115 months ago
Sounds simpler and fairer; kicking Spotify and Google is just an added side bonus ;-)
Score: 46 Votes (Like | Disagree)
Mac Fly (film) Avatar
115 months ago
Apple's lawyers are working harder than their engineers on this product
All the naysayers on MR should start their own technology company. You clearly are more capable than Apple. I'm not saying Apple can't be criticised, it's the incessant pissing and moaning in every post that gets me.
Score: 29 Votes (Like | Disagree)
RowellE Avatar
115 months ago
I misread "statutory rate."
Score: 22 Votes (Like | Disagree)
Abazigal Avatar
115 months ago
This is sooo not gonna fly.

First of all this is not about artists making any money cause 9.1 cents on a 100 streams is an insult but artists have accepted the offer to stream their music so who give a crap about them. They have blatantly chosen to make their money on tours and from merchandise if they have an easy 360 contract.

This hits the consumer the hardest cause they might not have a free option.

What I don't get here is how come the CRB only consulted Apple instead of other leading music streamers. That is the sole reason why this proposal will go down.
I guess the question then is - why do people feel entitled to a free music streaming option?

Spotify is still making a loss, even as musicians complain of not being paid enough. I am not sure a company like Spotify is exactly the best person to comment on such matters.

If anything, it just shows that a free music streaming option was likely never financially viable to begin with, seeing how it is causing Spotify to haemorrhage losses, and needs to be subsidised by the paid tier. Free music to the masses sounds like a great thing, but not when it comes at the expense of devaluing music and destroying value. It has been a nice experiment, but maybe a free streaming tier which clearly can't generate enough revenue to support itself simply isn't the way moving forward.

Yeah, it will be much better for the consumer when they have a choice of Apple or Apple. We know how Apple loves to pass on the savings to their loyal followers.
I didn't switch to the Apple ecosystem to save money. I switched precisely because I was willing to pay to get a great computing experience, and Apple simply offered the more compelling option.

If I need to pay more to get a better listening experience from Apple Music, I will.
Score: 18 Votes (Like | Disagree)