Apple Music is quietly making a $50 Million advance fund available for independent labels and distributors, to support the indie sector with vital cashflow during the uncertainty of global COVID-19 lockdown.
Record labels across the world are facing a triple danger from the fallout from Coronavirus: (i) Physical sales have been slashed to the nub by the closure of stores during quarantine; (ii) Licensing income from public performance plays and sync use has dried up due to a lack of in-person events plus a sudden stop in movie/TV production; (iii) Labels which participate in their artists’ live income are obviously seeing that revenue reduced to zero due to unanimous cancellations of shows.
Add into the mix the fact that many labels are cautiously postponing scheduled album releases for fear of a soft marketplace, and record companies now face a cocktail of negative economics.
In response, Apple is stepping up. The company is set to inform independent labels and distributors that any amongst their ranks who meet a minimum quarterly threshold of $10,000 in Apple Music earnings can qualify for one-off advance payments on future royalties out of the $50m fund. (Doing the math, that should mean those labels attracting around 500,000 cumulative streams on the platform each month are likely to be eligible for the money.)
Qualifying indie labels and/or distributors must have a direct distribution deal in place with Apple Music. This rules out indie labels who are distributed by major record companies (including those that go through The Orchard, ADA and Caroline) but means, for example, that a swathe of labels who are members of Merlin will be entitled to apply.
Apple is apparently telling the indies that it hopes the money will be used to “to help them pay artists and maintain operations”.
And in further good news for record labels and artists, suggest that Apple Music’s global subscriber numbers continued to grow month-on-month in March, despite streaming volumes on all audio services dipping amid stay-at-home directions from international governments.
What that means in practical terms is that more money, not less, is flowing towards music rights holders from Apple Music than it did a few weeks back – even as the company earmarks an eight-figure sum to ease the burden on indie labels during an uncertain time.
The $50m Apple Music initiative is understood to have company-wide support at Apple, and follows Apple CEO Tim Cook’s announcement over the weekend that the tech giant has sourced over 20m protective masks for frontline medical professionals globally.
Cook also announced an Apple-wide effort to design, produce and ship face shields for health workers in the US and abroad, with a plan to send a million shields per week to those who need them.
SOURCE: TIM INGHAM