UPDATE: Stroppy Apple threatens to close iTunes in MASSIVE SULK over royalty payments

Digital Music, Internet, iPhone, iPod, Mobile phones, MP3 players, Software, Web 2.0, Websites

apple-closing-itunes-royalty-argument.jpgThere are two very important financial rulings being voted on today. One is something to do with banks and mortgages and the world not ending, which we couldn’t care less about and certainly don’t intend trying to understand.

The other is to do with Apple and the amount of royalties it pays to record labels in return for selling their music on iTunes. Three Copyright Royalty Board judges are meeting in Washington today, to decide if Apple should be forced to boost its royalty payments from 9 cents a song to 15 cents a song for each track sold via iTunes – a 66% increase.

Apple has, incredibly, threatened to CLOSE iTunes if the decision doesn’t go its way…

Apple man Eddy Cue, the vice-president of iTunes, told The Times that Apple is “in this business to make money, and would most likely not continue to operate [iTunes] if it were no longer possible to do so profitably”.

Sulking in such a public manner is not going to do Apple’s all-white reputation much good, especially if the judges rule for the rise and call Apple’s bluff on this one and agree with the National Music Publishers’ Association demand for a pay rise for all its artists.

We’ll let you know the outcome of this ruling later today, or, if it’s past bed time, first thing tomorrow. You might find out about this first, should iTunes close overnight.

The CRB judges caved in. There will be no iTunes price rises, reductions or closures. They ruled that Apple can continue to pay the same amount to the recording industry for the next five years, in fact. So iTunes is saved. Whether that’s a good thing or a bad thing, though…

(Via MacWorld)

Related posts: iTunes gets HBO | App Store rocketing

Gary Cutlack
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One thought on “UPDATE: Stroppy Apple threatens to close iTunes in MASSIVE SULK over royalty payments

  • How interesting. You make it sound like it is Apple’s responsibility to reward artists appropriately. Given the share of each iTunes sale that a label takes I fail to see why this should be the case. It is the labels that should be approached for fairer royalties or it should be in the artists interests to go independent and sell directly to the #1 internet music retailer.

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