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Apple Beats up Spotify by refusing to serve freeloaders

Beats Music

New Beats music service will undercut Spotify, but won't offer freemium service

Apple is planning to attract artists to its revamped Beats Music service by promising not to give their albums away for free. No doubt looking to capitalise on a growing trend of artists removing their latest works from Spotify in protest at the poor returns they generate, Apple will reportedly make the new Beats a subscription-only service after a limited free trial. 

Spotify has faced a minor rebellion from artists in recent months, with acts such as Taylor Swift, Bjork and others refusing to allow their latest albums to be streamed on the service, or removing their work from Spotify altogether. The artists argue that Spotify fails to pay them sufficient royalties for their work – an accusation that Spotify has vehemently denied, claiming it has paid billions of dollars to record labels.

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Now, Apple is hoping to lure the disaffected artists to its soon to be revamped Beats music service. The company will offer artists incentives to release their work on Beats ahead of other streaming services, according to a report on Re/code. It will also force users to pay for access to the Beats library after a fixed-duration free trial, unlike Spotify, which offers free access to its music library in return for listening to adverts. However, Apple’s subscription prices will reportedly undercut those of Spotify, reducing the price to only $7.99 per month, as compared to Spotify’s $9.99 (£9.99 in the UK, which is already significantly more expensive than the US.) 

Apple’s no-freeloaders policy has apparently been warmly received by the record labels, who believe that services such as Spotify are failing to convert sufficient numbers of free users to paid subscribers. “We want to accelerate paid subscription,” Universal Music Group’s CEO, Lucian Grange, said at Re/code’s recent media conference. “Ad-funded on-demand is not going to sustain the entire ecosystem of the creators as well as the investors.”

Apple’s new Beats Music service is expected to launch by the summer. Apple bought Beats for $3 billion last year, acquiring not only the headphones business but the company’s fledgling streaming music service. Apple was reportedly impressed by the way Beats managed to convert free users into paying subscribers

Beats Music isn’t currently available in the UK, and it’s far from certain Apple will even launch it over here. iTunes Radio, Apple’s own streaming radio service, was launched in September 2013 but is currently only available in the US and Australia.  

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