Countless people in Las Vegas enjoy the convenience of streaming music. If it can be legally accessed for free, even better. However, artists have certain commercial rights, including the right to be paid for their work. Companies that provide streaming services to consumers pay musicians for the right to put their music up. Music streaming companies may earn revenue through advertisements, or consumers may pay a monthly fee to access music ad-free. Occasionally, streaming companies will promote a service by offering it for free for a limited time.
Apple recently unveiled its new Apple Music streaming service and offered it to customers for a free trial period of three months. This was a great deal for music fans, but not so much for artists. Apple had also said that it would not pay musicians during the trial. Not surprisingly, artists were not happy to hear the news.
Pop superstar Taylor Swift, as well as numerous other singers and bands, complained about the announcement. Ms. Swift in particular was quite vocal about the slight, even writing a public letter to the Apple company stating her displeasure that artists were not receiving payment in exchange for providing their music to a large audience. Ms. Swift explained that she was not worried about being compensated herself. Instead, she was concerned about those not yet fully established in the industry, such as new and independent artists, who could not afford to miss being paid for three months.
Some artists and producers could have protested by pulling their music from the site, but that might have resulted in long-term repercussions or bad publicity. Another option might have been to file an intellectual property dispute over non-payment. Fortunately, Apple executives decided Ms. Swift and others were right and announced they would pay artists during the trial period.
This example illustrates how a company may alienate or anger those they do business with by changing payment terms or refusing to pay altogether. Such incidents have the potential to bring about commercial litigation.
Source: International Business Times, “Taylor Swift Successfully Changes Apple’s Decision On Three-Month No-Pay Policy,” Annie D., June 24, 2015