Apple may be looking to pay record labels less for streaming music.
The tech giant is in negotiations with record labels to reduce the revenue rate it pays out for streaming music, Bloomberg reported on Wednesday. The talks cover agreements for Apple Music and iTunes, and would reportedly bring Apple closer to the rate Spotify pays labels.
Apple didn’t immediately respond to a request for comment.
Revenue from streaming music accounted for the majority of US major record labels’ sales for the first time ever in 2016, according to the Recording Industry Association of America. Subscriptions, like the monthly fees for Apple Music or Spotify’s paid tier, were the biggest money maker at $2.3 billion, and they basically doubled from a year earlier, the RIAA said. Record labels reportedly receive about 58 percent of revenue from Apple Music streams, while Spotify recently reduced its rate to 52 percent.
Apple’s licensing deals with the labels expire at the end of June but will likely be extended if a new agreement can’t be reached by then, reported Bloomberg.