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Indie labels speak out against Apple Music’s enhanced spatial audio royalties

  • 13 February 2024, Tuesday
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Indie Labels Apple Music - iMusician

Only a few months ago, it was leaked that Apple Music, alongside Spotify and Deezer, has decided to retool its royalty framework (we heard a lot about Spotify’s new threshold of minimum streams). In the case of Apple Music, the latest shift deals with offering bolstered royalty payments for works in spatial audio.

Only now have multiple sources confirmed the information, which was immediately met with waves of resentment, particularly from independent labels.

Up to 10% boost on the recorded royalties side

As Billboard has elaborated, starting at the end of January, all spatial audio tracks released on Apple Music should benefit from up to a 10% increase in their streaming royalties.

While this arrangement is unjust to independent and smaller artists (who cannot afford the higher production costs to make music in spatial audio), it would be relatively acceptable if the royalty boost was derived from a dedicated fund.

The payout rise will instead come from the service’s ‘pro-rata’ royalty pool. This, therefore, suggests that for some artists to gain a royalty boost, artists who do not release their music in spatial audio will experience a royalty reduction.

As Apple Music further explained, the “pro-rata shares for Spatial Available plays will be calculated using a factor of 1.1 while Non-Spatial Available plays will continue to use a factor of 1.” Such a change should not only “reward higher quality content but also ensure that artists are being compensated for the time and investment they put into mixing in Spatial.”

This, reportedly, is not to the liking of multiple independent labels, including Beggars Group, Secretly Group, and Partisan Records. As disclosed by the Financial Times, these companies have accused Apple of favoring the most prominent players on the market (namely Universal) while taking hard-earned money from independent artists.

Vocal criticism may not be the only act of defiance against Apple’s new policy. In fact, the independent labels have supposedly expressed interest in exploring “legal or regulatory options” should negotiations with Apple fail and the policy remain unchanged. And so does the turmoil in the music industry in 2024 continue…

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