Music royalties war averted. Page: 1

iTunes Store thrown a lifeline?

iTunes Store is safe

In a follow up to an article we published yesterday, regarding the proposed increase in royalties paid to artistes from digital music downloads, the proposal put forward by the National Music Publishers' Association was rejected yesterday by the Copyright Royalty Board. This has saved Apple from maybe having being forced to act upon the veiled threat made in April, 2007 by the company's vice president for iTunes, Eddy Cue, in a submitted testament to the Board at the Library of Congress:

"If iTS (iTunes Store) were forced to absorb any increase in the mechanical royalty rates, the result would be to significantly increase the likelihood of the store operating at a financial loss - which is no alternative at all. Apple has repeatedly made clear that it is in this business to make money, and would most likely not continue to operate iTS if it were no longer possible to do so profitably."

The testament only came to light this week, in the run up to the meeting of the CRB to discuss the NMPA's proposals. The CRB chose not to alter the amount of royalties paid for downloaded songs, which is currently set at  9 cents. The NMPA was seeking a raise of the amount, to 15 cents. Apple's Tom Neumayr said that Apple were happy with the decision.
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