Easyishop Blog

Apple’s iTunes and various mobile operators agreed yesterday on royalty rates to pay song writers and music publishers for music downloads in the UK. Under the deal Apple and four mobile operators will pay 8% of the Gross revenue, excluding VAT for all music downloads they sell. Under a previous deal, the law stated that the song writers and publishers must receive 12 percent; however, the royalty had been temporarily reduced to 8 percent based on a mutual agreement. The new agreement also implements a 6.5 percent royalty rate for non-on-demand services such as streaming, according to the report. The deal was announced in a joint statement by the trade group representing record labels, BPI, and MCPS-PRS Alliance, which fixes and collects royalties on behalf of the composers, song writers and music publishers.

“All parties to the settlement welcome this agreement, which will help drive the on-going growth of the legitimate digital music market,” the statement said. The agreement also included mobile operators O2, France Telecom’s Orange and Deutsche Telecom’s T-Mobile.

The publication also reports that the agreement includes a minimum price rate which ensures the music creators would still receive a rate, even if the price of music drops significantly.

“This is a balanced voluntary settlement in which both sides can draw not just comfort from, but excitement that they can go forward and build a business together based on an understanding that will work to the benefit of all,” BPI Chairman Peter Jamieson told Reuters.