News April 9, 2020

COVID-19 support funds from Apple and Spotify will reach Australia

COVID-19 support funds from Apple and Spotify will reach Australia

Yes, the big two DSPs are awake and listening.

Apple and have now outlined how they will help Australia’s aching music industry.

is preparing a US$50 million “advance fund” to support indie labels and distributors affected by the global COVID-19 health crisis.

In a letter sent to labels, obtained by TMN, the global tech and streaming powerhouse said one-time payments for eligible partners will be treated as “advances on future royalties”.

The fund will extend to independent labels and distributors in Australia, TMN can confirm.

However, there is one rather large caveat: only Apple partners with a direct-sign deal, who already earn over US$10,000 per quarter, will have access to the cash.

This means those hardest hit in the record business, including the vast majority of local labels, recording studios, artists and their immediate teams, won’t benefit from the initiative.

But it does spell good news for qualifying labels who are facing a cash flow crunch caused by the pandemic, as revenue from physical sales and licensing sinks, and big releases get shifted to “TBC” status due to artists’ inability to promote records on the road.

TMN spoke with a number of indie label owners with knowledge of who will (and who won’t) get access to the advanced royalties, with most expressing disappointment in the fine print.

“The reality is, only a few Australian-owned labels stand to benefit from this,” one label executive told TMN, on the condition of anonymity. “Future Classic, MGM and maybe Shock, are probably among the local operations with a direct deal outside of the majors.”

The 20,000 or so members of the Merlin Network will also be in line to apply for funds, but any labels distributed by one of the majors – Sony, Universal or Warner – will be out in the cold.

According to MBW, Apple hopes the indies will use the money “to help them pay artists and maintain operations” during the unprecedented and challenging months ahead.

“These are difficult times for the music industry globally,” the letter outlines.

“Livelihoods are at risk, with multiple sources of income that our industry relies on vanishing overnight. Apple has a deep, decades-long history with music, and we are proud to be in close partnership with the best labels and artists in the world. We want to help.”

Apple has already begun to contact the Australian labels who qualify for the advances.

Streaming rival Spotify has also committed up to US$10m to help the music biz during the COVID-19 pandemic. The fund will match, dollar-for-dollar, public donations via a dedicated website.

A portion of the moolah has already been distributed to MusiCares in the US, PRS Foundation and Help Musicians in the UK and The Unison Benevolent Fund in Canada.

TMN understands that Spotify is preparing to announce a partner for Australia and New Zealand shortly, with music charity Support Act the likely benefiter.

“Via our website, Spotify will recommend verified organizations that offer financial relief to those in the music community most in need,” the tech company shared in a blog post last month.

“Spotify will match dollar-for-dollar public donations, up to a total Spotify contribution of $10 million. We’ve also created a dedicated COVID-19 hub providing listeners with a go-to place for…”

Apple Music is also mobilising their platform real estate this Easter long weekend to support local artists, TMN can reveal.

Over the four-day-long weekend, users will notice an increased number of playlists dedicated to Aussie music across all genres, including The New Australia (hip hop), Heaps Indie, Essential Aussie Country and Essential Aussie Songs.

The initiative, dubbed Stream Local, will feature a new 100 Most Streamed Australian Songs playlist, with the most-streamed Aussie songs since the launch of Apple Music in 2015.

Major labels Sony Music Entertainment and Universal Music Group have also shared details on how they plan to support the industry, with the former establishing a US$100m relief fund.

A spokesperson from Warner Music group also told TMN that the major focussed on its staff and contributions to various relief efforts.

“We’re focused on keeping our people and our artists safe, sustaining their livelihoods, and supporting the music ecosystem,” they said.

“As part of those efforts, we’re donating to medical organizations, helping with various fundraising initiatives by artists and songwriters, and contributing to aid relief for the wider music community.”

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