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Apple U-turns after Taylor Swift slams music policy

Apple has made a U-turn over artist royalties for its new music streaming service, after pop megastar Taylor Swift said she was holding back her "1989" album.

In an open letter, Swift said she was "disappointed" that the technology giant would not be paying writers, producers, or artists during a free three-month trial when people sign up to Apple Music—its new streaming service which will launch on June 30.

But a series of tweets by Eddy Cue, Apple's senior vice president, showed the Cupertino, California-based company will now be paying artists during the free trial period.



The amount of royalties going to artists remained undisclosed during this trial period, but will be paid on a "per stream" basis, according to comments by Cue in BuzzFeed. After this, Apple will pay music owners 71.5 percent of Apple Music's subscription revenue in the U.S., Robert Kondrk, Apple's iTunes chief, told Re/code earlier this month, but could rise to 73 percent in other countries.


Swift said in a tweet that she was "elated" by the change of policy.

"Three months is a long time to go unpaid, and it is unfair to ask anyone to work for nothing," she wrote.

"I say this with love, reverence and admiration for everything else Apple has done. I hope that soon I can join them in the progression towards a streaming model that seems fair to those who create this music."

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The former president of Chrysalis Music Publishing, Tom Sturges, said Swift was speaking out for all the independent artists out there.

"Taylor Swift came down hard on the side of all independent artists," said Sturges during an interview with CNBC's "Power Lunch" on Monday. "You have to remember she is an independent artist; she is not signed to a major label."

Jeff Price, founder of TuneCore and CEO of Audiam, said the situation now represents a win-win situation for everyone.

"Apple gets additional marketing and promotion for the forthcoming service launching in nine days or so," said Price during Monday's "Power Lunch."

"They get to look like they have a soul because they actually have one. Taylor is fighting out there for what appears to be the little guy and she actually is. And it raises all the boats in the water higher."

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Swift has been a vocal critic of the royalty payments made by music streaming services. Last year, the "Shake It Off" singer pulled her entire music catalog from Spotify.