How Taylor Swift convinced Apple to switch gears on music streaming

If there was ever any doubt about how powerful superstar Taylor Swift is, let this be a lesson: Hours after Swift admonished Apple for not paying royalties to artists during Apple Music's free 3-month trial, the company abruptly switched gears.

"We don't ask you for free iPhones," Swift wrote in a Sunday morning blog post. "Please don't ask us to provide you with our music for no compensation."

Apple media head Eddy Cue took to Twitter Sunday night after Swift's open letter to the company went viral and announced that Apple will pay artists for songs streamed during the free trial.

Cue told Re/code that Apple will pay music rights-holders (typically record labels and song publishers) per stream during the trial, and rights-holders will then pay out their musicians. The per-stream rate won't be as high during the free trial as it will when Apple Music subscribers start paying $9.99 a month, because Apple is sharing subscription revenues with labels.

Why this matters: Nothing has changed for potential Apple Music subscribers, but music labels and artists who rely on royalty payments to scrape by will be more likely to sign on with the streaming service now that they're getting paid.

Why Swift stood up to Apple

Indie labels and musicians have been complaining about Apple's policy of withholding royalty payments during the free trial since Apple Music was announced at the Worldwide Developers Conference earlier this month. Apple had worked out deals with the major labels that promised them a higher-than-standard revenue share--71.5 percent in the U.S. and around 73 percent overseas--if they agreed to forego royalty payments during the free trial. But smaller labels and indie artists who rely on royalties to get by were furious over the deal, and Swift stood up to Apple on their behalf.

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

She used her best-selling album 1989 as leverage and pulled it from Apple Music. It's unclear if Swift will give Apple the OK to stream the album now that the company has reversed course, but if she does, it would be a big win for Apple--no other streaming service has 1989.

Apple Music rolls out on June 30, and now Apple can use the days leading up to the launch to promote the service instead of answering questions about Taylor Swift and royalty payments.

Does Apple's change of heart make you more likely to give Apple Music a shot Let us know in the comments.


Caitlin McGarry

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