Apple is negotiating with record labels about the reduction of their share in profits from music streaming. It is reported Bloomberg citing sources familiar with the situation.
At the end of this month to expire contracts Apple Music with the record companies. Cupertinos plans to sign new agreements on more favorable terms.
Under current arrangements, Apple pays Music labels for 58% of revenue. It’s a lot more than other music services. For comparison, Spotify is the largest streaming audience service agreed to reduced payments from 55% to 51% according to the results of recent negotiations.
The record companies are willing to make concessions if Apple will be able to expand the audience of subscribers and perform a number of other requirements. In particular, the music labels appealed to the company asking about the promotion iTunes in countries where streaming music is not so popular.
Originally the “Apple” brand was forced to agree to higher payments, as the labels were concerned about entering the market. They also feared that the Apple iTunes Music engulf — their main source of income. As it turned out, these fears were unfounded.
According to official data, Apple Music has 27 million paid subscribers.