Apple is set to launch the latest version of the popular subscription based music platform, made popular by the likes of Pandora and Spotify. Now music labels are lining up to court the large corporation into negotiating a piece of the per-month subscription revenue. Sources are saying music industry negotiators are looking for anywhere from 60-70%of the $10 subscription fee. This is significantly more than the average split established services offer music providers, 46% according to Ernst & Young.
Of late, music labels are looking to regain revenue they may have been losing to such streaming services. Renegotiations may be coming for established services as labels are looking for high percentage of revenues.
Apple has made a habit of perfecting products and services before entering each new market. With this being their latest venture, many are being led to believe that this new market will see the success Apple has had in previous ones. This is putting the pressure on music labels to ensure a profitable deal be made with Apple in order to sustain their revenue streams.
By the end of next year, streaming music revenue is expected to top out at $1.6 billion for the total industry and labels are set on making their living on a piece of that total. This is marking a possible shake up in the streaming world. Apple has yet to sign a deal but all eyes are already fixed upon them. Keep your eyes and ears open for the latest streaming tunes come June. The move comes as Apple has seen their download revenue slip over the fast 3 years from $2.5 billion to $1.5 billion.
Tim Cook, CEO of Apple is confident in their development of a top notch service and will continue negotiations with labels until an agreement has been reached.
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