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Here’s why your Apple Music or Spotify subscription may cost more in the future

POSTED February 8, 2018 8:59 a.m.
A new agreement will allow songwriters to earn more money for streaming, but it could eventually lead to higher costs for people who subscribe to music streaming services.

The Copyright Royalty Board ruled in late January to increase the songwriter rates for streaming services by nearly 50 percent over the next five years, according to Variety.

Apple, Amazon, Spotify, Google and Pandora will now be required to pay artists more money for streamed music thanks to the ruling.

According to The Verge, songwriters will see their pay raise from 10.5 percent of revenue to 15.1 percent, which will represent a 43.8 percent increase.

The decision came after a dispute between National Music Publishers’ Association and multiple streaming services.

Music labels still make more than artists, though, earning $3.82 for every $1 publishers and songwriters make, according to The Verge.

A UC Irvine media studies professor told Mashable that it would take 4 million Spotify streams for a songwriter to make minimum wage in California for a month.

Raising payment rates for artists could affect streaming services and those who use them, though, according to a separate Mashable article. Spotify and Apple Music already don’t make much money (Spotify lost half a billion dollars in 2016, for example).

This new agreement doesn’t mean the $9.99 fee for streaming music services will rise right away, experts told Mashable. Music publishers negotiate with services to set a fair price for what their artists' music represents, which eventually sets the monthly prices for streaming services.

However, Drexel University's music industry program Robert Weitzner said Spotify and Apple Music will have to raise prices in the near future, especially as they continue to add more content, like videos, podcasts and news.

"In the long run, they are gonna try and raise their prices as the services get better and they contextualize their offering," he said.

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