Apple agrees to pay music royalties for the first time, bows down to Taylor Swifts’ demands

After pop superstar Taylor Swift slammed Apple in an online open letter, titled "To Apple, Love Taylor," the Cupertino-based tech giant announced that it will pay royalties to artists and record labels for music played during a free, three-month trial of its new streaming music service.

In an interview with The Associated Press, Eddy Cue, Apple senior vice-president, said, "When I woke up this morning and I saw Taylor's note that she had written, it really solidified that we needed to make a change."

If we believe the reports, Apple had already agreed to share revenue from paid subscriptions to the new Apple Music service, which will cost $9.99 (£6.30) per month in the US for one person or $14.99 for families.

The 25-year-old American singer, song-writer and actress would withhold her latest album from the service because Apple wasn't planning to pay artists and labels directly for the use of their music during the free, introductory period. Swift wrote, "We don't ask you for free iPhones. Please don't ask us to provide you with our music for no compensation."

Apple has maintained that it negotiated revenue-sharing at rates that are slightly higher than the industry standard, to compensate for the three months that it plans to offer its streaming service without charge.

However, Cue declined to reveal how much Apple will pay in royalties for streaming during the free trial period. According to him, the technology major will share 71.5% of its revenue from paid subscriptions within the US and 73% from subscriptions outside the country, while other streaming services generally share about 70%.