Exploration Weekly - The MLC Distributed $700M to Members / Apple Music Now Costs $10.99 in the US / Spotify MAUs Up 20% YoY

Aaron Davis -




In this newsletter:

The MLC announced in its latest Annual Membership Meeting that in the year and a half since launching full operations, the organization has successfully distributed nearly $700 million in blanket royalties to its Members. The MLC also added that it met every milestone set by Congress in the Music Modernization Act of 2018.

Apple has increased the price for Apple TV+, Apple One, and Apple Music worldwide. Starting October 24, Apple Music will cost $1 more, from $9.99 to $10.99 per month. The company stated that the change in its pricing “is due to an increase in licensing costs”.

In their latest earnings call, Spotify represented its largest Q3 growth to date in monthly active users (MAUs), growing 20% to 456 million - 6 million above Spotify’s prior guidance. The company is looking at raising prices on its US subscription plans, following increases by Apple Music and YouTube Premium, according to CEO Daniel Ek.

Exploration Weekly - October 28, 2022

Now, the details...
Compiled by Heidi Seo

The MLC Holds Second Annual Membership Meeting: Announces Nearly $700M in Royalties Distributed to Date to Members

According to The Mechanical Licensing Collective (The MLC) during its second Annual Membership Meeting this week, in the year and a half since launching full operations, The MLC has met every milestone set by Congress in the Music Modernization Act of 2018 and successfully distributed nearly $700 million in blanket royalties to its Members. Other highlights include collecting almost $1 billion in mechanical royalties and adding more than 6,000 Members to date in 2022.

Apple Music Just Raised Its Subscription Price to $10.99 in the US. Will Spotify Be Next?

Apple is increasing the pricing for Apple TV+, Apple One, and Apple Music worldwide. In the US, starting from Monday (October 24), an individual Apple Music subscription will go up by $1, from the current $9.99 price point to $10.99 per month. In a statement provided to MBW, Apple said that the change in its Apple Music pricing “is due to an increase in licensing costs” and that, “in turn, artists and songwriters will earn more for the streaming of their music”. Apple Music also released new features over the past couple of years including the rollout of Lossless Audio and Spatial Audio with support for Dolby Atmos to its service in May 2021 at no additional cost. The platform revealed earlier this month that it now has 100 million songs. Apple’s price hikes to its Individual and Family music plans in the US mark the first time that the company has raised its subscription prices in the market.

Spotify Reaches 456 Million Total Monthly Users in Q3, Up 20% Year Over Year and Topping Expectations

In its most recent earnings call, Spotify announced its total monthly active users (MAUs) grew 20% to 456 million — 6 million above Spotify’s prior guidance — a net addition of 23 million, representing its largest Q3 growth to date. Spotify Premium subs reached 195 million, up 13% year over year. CEO of Spotify, Daniel Ek said the company is looking at raising prices on its U.S. subscription plans, following increases by Apple Music and YouTube Premium. Total revenue was €3.04 billion, slightly ahead of guidance, representing 21% year-over-year growth. However, Spotify’s gross margin in Q3 came in below expectations at 24.7%, which the company said was “affected by an accrual adjustment from an anticipated renewal of a large publishing contract outside the U.S.,” along with “some softness in advertising and currency fluctuations.”

YouTube Sees Ad Revenue Drop Slightly to $7.07B During Third Quarter

YouTube’s ad revenue dropped down to $7.07 billion during the third quarter, marking a 1.9% decrease compared to the previous year, parent company Alphabet reported on Tuesday. YouTube’s ad revenue growth has slowed down considerably since the earlier years of the pandemic, when the company saw massive gains. But the video giant isn’t the only tech and social platform to be impacted by a declining digital ad market. Snap, which has previously warned of macroeconomic headwinds impacting its ad business, reported a net loss of $360 million during Q3 as the company has seen engagement in the U.S. decrease by 5 percent year over year.

Song Right Revenues Began to Recover in 2021, But Are Still 5.1% Below Pre-Pandemic Levels

According to global collecting society grouping CISAC, revenues collected by song rights collecting societies worldwide increased by 7.2% to 8.48 billion euros last year, following a COVID-caused dip in 2020. However, with live music still very much restricted in 2021, total collections were 5.1% down compared to pre-pandemic levels. Global income for live and public performance, which CISAC groups together in its stats, was basically flat in 2021. Broadcast revenues saw another slight decline in the same year, down 1.8% to 3.19 billion euros. With key revenue streams like live performance, public performance and broadcast more or less flat in 2021, the overall growth of revenues year-on-year was very much powered by increases in digital. Continued growth of subscription music services, plus increased income from user-generated content platforms, meant that digital collections were up 27.5% worldwide.

YouTube Announces $5 Price Hike for Its Premium Family Plan

If you are a customer of the YouTube Premium family plan and you live in the United States, you’re going to have to pay $5 more for the subscription. Beginning on November 21, that plan’s price hike is going into effect for Premium subscribers in multiple countries. YouTube Premium offers several improvements for viewers, including ad-free videos and downloads for offline viewing. The family plan, which lets up to five individuals take advantage of these features, previously cost $17.99 per month in the U.S. That means the subscription will cost $22.99 per month beginning in November. The price hike for YouTube Premium will only affect the family plan. Individual users will continue to pay $11.99 per month for access to the service. Though YouTube is initiating Premium price hikes around the world, those upcharges vary from country to country.

Apple Services Revenue Drops Slightly to $19.2B As Total Subscriptions Top 900M

Apple services, the category which encompasses Apple TV+ and Apple Music, saw another slight drop in revenue during the fourth fiscal quarter ending in September. The category generated $19.2 billion in revenue, down slightly from the $19.6 billion reported during the third fiscal quarter ending in June. But compared to the previous year, Apple’s FY Q4 services revenue represented a 5% year-over-year increase. Apple now has more than 900 million paid subscriptions, up from the 860 million reported during Q3, according to Apple CEO Tim Cook.

Random Ramblings

  • An update in music on termination rights and the Music Modernization Act, from the U.S. Copyright Office.
  • Why is music today so bass heavy?
  • Lil Baby becomes the third act to chart 25 songs on the Hot 100 in a single week.
  • How humans are collecting sounds from space.
  • The story behind Natasha Bedingfield's pop hit "Unwritten".

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