Apple nets up to £790 million from iTunes Music sales
Apple’s iTunes Music store, could have earned the company anything up to a whopping £790 million, following news that the 10 billionth song had been downloaded this week.
It’s widely thought that the tech giant retains around 10 per cent of the price of every song sold on the store, although Apple itself has never released any official figures.
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If correct, (after publishers, artists, record labels and running costs are paid), Apple would retain a 7.9 pence of the 79p pricetag on each of the 10-billion tracks downloaded. That would mean profits of anything up to £790,000,000 since the iTunes Music Store’s inception in April 2003. That’s over £2 million a week!
Competition from online music sites like Amazon MP3, in recent years, has forced iTunes to move from the rigid 79p pricing structure in recent years, however, with tracks now ranging up to 99p, but most songs remain at the standard level.
A spokesperson for the PRS, the body that regulates payments to artists and publishers for the sale of music, explained the breakdown to T3 in a statement this morning, but wouldn’t be drawn on exactly how much money Apple and its competitors pocketed.
The spokesperson said: "PRS for Music which represents the songwriters, composers and music publishers would receive 8% of gross revenue per track downloaded, with a minima level of 4p. For a typical 79p download when VAT is factored in, this would result in the creator of the song receiving between 6p and 7p for each download. Included into the price of a download is also the royalty received by the record label, the costs of marketing and the technology behind the service and then a small profit margin for the owner of the site itself."
Even if the actual revenue for each track is half of what has been quoted on numerous occasions in the past, it still represents a massive bounty for Apple, and a huge reward for its industry-changing vision.
The 10 billionth song download was a Johnny Cash track called "Guess Things Happen That Way" and earned lucky shopper Louie Sulcer from Georgia, USA, a $10,000 iTunes gift card.
Link: Apple
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