Jimmy Iovine announces Apple Music in 2015.
For months, there have been reports and rumors that Apple is about to launch its own response to Amazon Prime: a bundled subscription service that allows users to access Apple Music, Apple TV +, and Apple News + for a flat fee. However, a new article detailing Apple's newly signed contracts with major record labels for Apple Music questions this prediction – at least in the short term.
According to a Financial Times report, Apple Music has signed new contracts with Sony Music, Warner Music Group and Universal Music Group to offer artists of these labels work for Apple's streaming service in the coming years. These include big names like Taylor Swift, Kendrick Lamar, Blake Shelton and Mariah Carey.
However, according to the Financial Times sources, the new contracts do not include an "economic agreement to bundle Apple Music with the company's television service." At the end of last year, Bloomberg reported that Apple is pursuing a plan to bundle Apple TV +, Apple Music, and Apple News + in one service. (Apple Arcade and the company's other services were not mentioned.)
This article clarified that Apple has included a provision in its contracts with magazine and newspaper publishers that "the iPhone maker can use to bundle the News + subscription service with other paid digital offerings."
Magazine and newspaper publishers were concerned about the deal, as it likely meant that they would receive a much smaller amount of money per subscriber than they currently do. Today Apple charges $ 9.99 a month for News + and makes up 50 percent of that revenue. Then the rest is shared among the publishers who are part of the service based on how much their content is read and edited.
Music labels may be concerned about something similar. Financial Times writes: "Apple has told major music companies that it intends to consolidate its media services, but the two sides have yet to agree on the details of a media bundling plan, according to people familiar with the matter."
Apple signed these music deals as part of negotiations between its main US competitor, Spotify, and two of the same labels. Spotify has signed a contract with Sony, but Universal and Warner have agreed to only enter into short-term contracts with Spotify, measured in months, as they continue to work out details that are critical to more sustainable long-term agreements.