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Apple: Music service a success, music downloads not going anywhere
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Jun 14, 2016, 06:17 PM
On the occasion of Apple Music's upcoming first-year anniversary, a quartet of Apple music executives -- SVP of Internet Software and Services Eddy Cue, VP of Content and Media Apps Robert Kondrk, Apple Music Chief Creative Officer Trent Reznor, and the still-untitled Jimmy Iovine -- gave an interview with Billboard that covered not only Apple Music, but the state of the music industry in general. Along the way, the execs indirectly refuted a recent claim that Apple would cease offering music downloads within two years

As announced on stage at the WWDC keynote, Apple Music has reached 15 million paid subscribers in its first year -- an impressive growth rate, and based on previous updates appears to be growing at the rate of about one million users per month. If that were to continue, Apple Music would likely be one of the largest streaming services by this time next year, though it will get strong competition from its chief rival Spotify. Despite the success of the venture, however, the Apple team expressed great concern for artists' financial viability in the future.

Cue, Kondrk, Reznor head Apple's iTunes, Music teams
Cue, Kondrk, Reznor head Apple's iTunes, Music teams

Reznor, who maintains his recording career, had the most to say on this subject. While Iovine noted that Apple's overall music revenue is actually higher now because of the income from the combination of downloads and streaming, Reznor noted that he brought "the burden and legacy of having come from the system before that, where livelihood could be made selling physical products and life made sense, you knew who the enemies were and you knew how to get your music out

"In this state of disruption," Reznor continued, "what interests me most as an artist, and what has been great about working with Jimmy before Apple and within the Apple ecosystem, is trying to bring that sense of opportunity to the musician. The last 10 years or so have felt depressing because avenues are shutting down. Little shrines to music lovers -- record shops -- are disappearing ... And every time there's a new innovation, the musician is the one that didn't have a voice at the table about how it's presented."

When asked directly if they were worried about artists being able to make a living in the near future, both Reznor and Iovine would quick to respond, with Iovine saying "we all should be." It was clear to both men back before they joined Apple that the future of commercial music was streaming, but as with other artists, this has resulted in a significant drop in income for most artists, with a select few thriving under the system, such as the most popular artists.

"I've dedicated my whole life to this craft, which, for a variety of reasons, is one that people feel we don't need to pay for anymore," said Reznor. "And I went through a period of pointing fingers and being the grumpy, old, get-off-my-lawn guy. But then you realize, let's adapt and figure out how to make this better instead of just complain about it." Iovine pointed to the recent success of Drake's latest album and the way in which Apple played a key role in cross-promoting it.

"What happened with Drake is very important, and should be looked at very closely," Iovine said. "Drake broke every streaming record and did a million downloads -- all paid." Cue added "and all paid at a full rate. There's a lot of streaming that doesn't get paid at a full rate. And while Drake is one thing, it's another thing to do it with Chance," referring to Chance the Rapper, the subject of another recent Apple promotional effort. "You can call those both sides of the house -- from the most famous and very successful to the unknown."

Artist Drake has, with Apple's help, conquered sales and streaming
Artist Drake has, with Apple's help, conquered sales and streaming

Kondrk pointed to this better unification of promotional efforts between iTunes and Apple Music as one of the biggest changes that has happened in the past year. "The teams have learned how to work together, so Beats 1 is almost the tip of the arrow," he said. "[Beats 1 head] Zane[Lowe] will introduce something, and then it goes into Apple Music, and it goes into iTunes and all the promotion we do across our whole music ecosystem, and you end up with a result like we had with Drake. It's all stitched together now."

The execs also pointed to the recent re-organization of both Apple Music's interface generally, and recent changes to Beats 1 with some obvious pride, giving Reznor credit for some of the thinking behind them. "On the Beats 1 side, it's growing very rapidly. and the one thing we wanted to do is make all the shows be available on demand and really easy to find," said Cue. "We redesigned the whole radio piece with enhancements to make the experience of Beats 1 that much better."

Iovine added that "Beats 1 is going to be creating a lot more content as well, [including] video. The thing about Beats 1 is its impact. The right people are listening and people are really interested in getting their records on there." Reznor said that "I think you've seen the DNA of me in what we've shown [at WWDC] and the concepts behind what we released a year ago. It's been really interesting for me to see how this works and how much time and patience it takes. The update of Apple Music is a result of us taking a hard look at how people actually use it -- not hypothetically, but realistically."

Zane Lowe of Beats 1
Zane Lowe of Beats 1

Asked about Google-owned YouTube's various music efforts, which have recently come under fire from music executives, Apple piled on to the current criticism about how it avoids paying for content. "Personally, I find YouTube's business to be very disingenuous," Reznor said. "It is built on the backs of free, stolen content and that's how they got that big. I think any free-tiered service is not fair. It's making their numbers and getting them a big IPO and it is built on the back of my work and that of my peers. That's how I feel about it. Strongly."

When asked about how difficult it was to get software engineers (represented by Billboard as "northern California") and creatives ("southern California") together and working smoothly, the team pointed to Apple's history of doing this, but talked about how much transition was involved due to the influx of hundreds of new employees on both ends of that, due to the acquisition of Beats and Apple's increasing need for large-scale software infrastructure.

"One of the great things about Steve [Jobs] was that, because of his [stake in] Pixar, he had a very different understanding of entertainment and of L.A. and Hollywood," said Cue. "I've always felt that technology companies have disrespected the content creation process and the content creation people disrespect technology. Both think, "How hard [could it be]?" The truth is, and I understand this really well, is that both of them are artists when it comes down to it. A programmer starts with a blank screen, no different than starting a song with a blank sheet of paper."

"We've integrated teams of people from both of the industries. I'm very proud of where we've gotten so far," said Iovine. Kondrk added that "our teams also go back and forth. There's a lot of travel to cross-hatch. The teams respect each other, and you can feel it." Reznor noted that "I've been around musicians and creatives for most of my life. Now being immersed with engineers who think differently in a lot of ways, the secret to the relationship has been respect in terms of realizing the value of what creative can bring to the table. And on the other end of it, there's no way I could do what these guys do, but it is that balance of realizing what is complementary."

When pressed about whether it was really that harmonious or whether the process by necessity involved conflict, Reznor admitted that "we don't always use our inside voices." Cue, a veteran of Apple and right-hand man to both Steve Jobs and now Tim Cook, added: "If you're gonna do something great, that's the only way."
Dedicated MacNNer
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Jun 14, 2016, 07:46 PM
But almost everyone loves free and stolen content. I can spend hours on Youtube.com downloading copyrighted music content. It's more fun than downloading pirated music from a newsserver. I got to hand it to Google. That's one thing they got going for them to get plenty of people to use Youtube. Sweet.
Charles Martin
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Jun 14, 2016, 07:52 PM
My philosophy is that if I like an artist enough to steal their music, I should pay them for it so that they don't starve and make more. That's just me, I like being able to say I'm a fan of [artist] and support their career to their face without lying.
Charles Martin
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