Archive for the ‘Apple’ Category

Apple vs. Taylor Swift: The Royalties Debate

Monday, June 22nd, 2015

Apple has not received a lot of good press regarding the tech giant’s new music streaming service. Complaints noting the company was bullying the music industry flew far and wide. The government has even threatened to get involved due to Apple’s practices. Now, more bad publicity is emerging as star Taylor Swift has chimed in on issues over royalties.

Basically, Apple was not going to pay any royalties to artists streamed on their service during an initial three-month trial period. Swift criticized this decision online and, within 24 hours, Apple reversed course and announced royalties will be paid reports Dr. Jennifer Walden. Apple probably was worried at how awful the company’s image would appear. Refusing to pay the artists the company intended to make money from is not easy to defend. Apple is a mega-billion dollar company. Denying miniscule payments to artists makes the company look greedy. Bad publicity of that nature turns off customers. Apple definitely does not want to chase away potential customers during the launch period of the service.

Why was there an initial decision not to pay royalties?

Apple, like any other company, looks at the bottom line. Profits drive up the stock price and keep the company solvent. Cash also allows the company to engage in research and development, which is extremely costly. So, Apple is going to look to cut costs and expenses wherever it can.

Not paying royalties to artists being used on a pay streaming service, however, is more than unfair. Apple did the right thing changing course even if the tech company had to be nudged publicly to do so.