Apple Music has contracted licenses with the term agreed to a few years with the most prominent and renowned companies in the music industry. The Cupertino-based tech giant has inked new agreements with companies like Universal Music, and Warner Music Group, as well as Sony Music.
According to the Financial Times, the deals regarding recorded music have been struck in the last few months. The contracts, however, did not license Apple to bundle its Apple Music service with Apple TV, the sources say.
As per the report, Apple intends to design a ‘super bundle’ that includes TV, music, and some other additions, but it will require inking new deals with the companies it struck the agreements with in order to do so.
Spotify is Also in Talks for New Deals
As opposed to Apple, Spotify has new, as well as already existing multi-year agreements in place with Sony Music and Merlin. However, the long-term deals with Universal Music and Warner Music Group have now expired.
These companies are currently in talks with Spotify over new contracts. A highlighted issue of these discussions is thought to be the system by which SPOT‘s podcast-yielded revenues are handed to the platform’s music partners in the future.
Spotify CFO Paul Vogel said in a Q&A session at Morgan Stanley’s Technology, Media & Telecom Conference earlier this month: “Clearly it’s taking a while to get some of these deals done.”
He continued: “We understand what we need, but we’re inaccurate with [predicting] the timeline, and that has continued. But, nothing is being impacted or slowed down by our negotiations with the labels. We’re definitely partners with labels, we know they help us grow, and they know streaming is the marketplace – we’re the largest contributor to streaming growth, every other platform is declining, but they’re very much partners.”
Spotify reported last month that it has 124 million paid subscribers, while Apple Music is the world’s second-ranked streaming service, and reported in June that it had 60 million paid subscribers. Apple’s Services division, which includes Apple Music, has generated $46.3 billion in revenue last year.