Peter Kafka at Recode has a good rundown of the whole affair, including information direct from Eddy Cue:
Cue says that Swift’s letter, coupled with complaints from indie labels and artists, did indeed prompt the change. He said he discussed the about-face with Apple CEO Tim Cook today. “It’s something we worked on together. Ultimately, we both wanted to make the change.”
Cue says Apple will pay rights holders for the entire three months of the trial period. It can’t be at the same rate that Apple is paying them after free users become subscribers, since Apple is paying out a percentage of revenues once subscribers start paying. Instead, he says, Apple will pay rights holders on a per-stream basis, which he won’t disclose.
I’ve already heard cynical voices decry this as a publicity stunt from start to finish; while I’d be lying if I didn’t say the same thought crossed my mind, ultimately it hews a little too closely to a conspiracy theorist narrative for my tastes.
From a business standpoint, Apple would probably prefer not to pay out while its service isn’t generating any revenue. That’s simple profit maximization. But the company’s also smart enough to take the long view of trying not to alienate artists–especially those as popular as Taylor Swift–when it’s trying to get said service off the ground. That would have been a fast route to dead-on-arrival.
In the end, while it certainly behooves Apple to present this as “doing the right thing by artists,” that excuse rings a bit hollow. If one’s aim is to do the right thing, it shouldn’t require a popular and influential celebrity to bring it to one’s attention. Nope: this is just business, a simple balancing of risk and reward.