Apple Music head, Jimmy lovine, sat down with HBO CEO Richard Plelper to discuss music streaming services. lovine thinks free streaming services such as Spotify are an issue. Apple Music offered a free three-month trial, but there is no free service once the time is up.
“We have a problem in the industry, I believe. This whole ‘free’ issue. The television industry doesn’t have it, the movie industry doesn’t have it, but the record industry has it. In my personal opinion – this is not Apple’s opinion – free is a real issue. You have to build a service in order to get over ‘free’. This whole thing about ‘freemium’… maybe at one time we needed it, but right now, to me, it’s a shell game. What these companies are doing is building the old-school traffic.”
Iovine, who also has a history in the music industry as a record producer and co-founder of Interscope, thinks because of free streaming services records aren’t selling and the only way for an artist is to go on tour.
“If you’re an artist and you put out a record – most artists only have one or two hit records – that has 100million streams, on certain services you only get paid on 75% of those streams. How’s an artist going to live like that? So then they say ‘okay, I’m not going to make any money out of records, so I’m going to go on tour’.”
The flipside to this argument is that Google’s Eric Schmidt thinks Apple Music is a decade out of date. Watch the full interview above with the discussion on free streaming services starting around the 5:45 mark.
Read our feature on how streaming services are affecting indie labels here.