A (4:07)

And what's interesting is that some of those other companies you're referring to, it all sits in one house as one product. But you also oversee podcasts as well. But you keep those products distinct. And in many ways, that is a very different operation than what you're doing with Apple Music.

C (4:22)

Yeah, we have a bookstore. We keep those products separated. We're very focused on music, and we believe for a music fan, a music app should be all about music, and it should be more than the song. So one of the things I'm really proud of in the 10 years of Apple Music is we've always been very artist focused. And when we launched Apple Music 10 years ago, one of the big concerns was that streaming would commoditize music. And just a sheer list of 100 million songs wouldn't allow artists really to express themselves and the customer would not really know much about the artist because all they know is the music. And very often they don't even look at the COVID art. And so we built Apple Music Radio. We built Apple Music studios around the world. They're really open houses for artists to come in. They could do a radio show, they could do an interview, they could do photography, they could do a TikTok dance, they could do something for social media, whatever it is. We just opened a new space here in LA a couple of months ago. That's 15,000 square feet. And that's a real big canvas for artists just to create content. Because we do believe for a true music fan, you want more than just the songs. You really want to know a little more about the artists, what they look like, what they do, why they made an album, and so on. And that's really the philosophy of Apple Music.

B (5:28)

I often think about that.

A (5:29)

Steve Jobs quote back in the 2000s when he said that a subscription product would not work in music, he thought that the itunes that you pay for, the model, that was the way to go and look where we are. I mean, obviously so much has changed in the world and that was a very different time. But it just shows how fast all of this goes.

C (5:47)

We, as a company, we always look forward and we always try to put the customer first and the creators, in this case the artist first. And it's. We're happy to adapt and move on with the time. But I, I think to back to your first question. I think digital music has been great for the music business. It's been great for many people in the music business, but we've got some challenges. Artists aren't so happy. There's many artists that aren't making enough money in streaming and too many people are consuming music for free. And to be fair, I think we need more incentives, we need more parties in streaming. There needs to be more things happen.

A (6:23)

A few thoughts on that, but I do want to talk about Apple Music itself, where the business is today. There's been a lot of speculation in terms of growth for the business, specifically in terms of paid subscribers. I know you don't necessarily like to talk about numbers specifically, but is the business still growing? Do you have more subscribers this year than you had in years past? How's that been?

C (6:45)

You're right. Our focus is when we wake up in the morning, the first thing is not us looking at our subscriber numbers. We look at the customer and the artist first. That this is our no stop with an Apple. So we try to build a great product for our customers. Let's start with that. So the number that's way more important for us than the total number of subscribers is what we call churn, which is how many people leave the service and why do they leave the service and what is it that made them unhappy to leave. And that's for us a barometer of how good the product is. And the better the product is, you think the lower the churn is. And we've been working really hard to lower our churn and the labels are telling me that we got the lowest churn in the industry, but I don't know that because I don't know the true churn numbers of our competitors. But we're very laser focused on that, trying to build features that will make happier customers, that will make them use the product more and that are innovative and cool that people want to come and check out. The second metric that was really important to us is happiness of artists. We try to make every decision based on what is good for the creators. And when I say artists, singers, but also songwriters and everyone who's involved in the creative process of making music through the studios that we have and through the radio stations. We have such an open platform of artists come in and we feel like we're really doing a good job there. On the subscriber side, we're growing and we're happy with our growth and we're never satisfied because as a company we want to be bigger and bigger, but we're really happy with where we are and it's all going according to plan.

A (8:06)

Something I do think about with growth specifically, and this isn't just with Apple music, with the entire industry overall. We heard you loud and clear with David Israelite at the NPA session and you said a little bit about it here in terms of free services or ad supported services, wanting to move away from that. But when I look at where the business is right now, streaming revenue growth specifically is starting to slow down quite a bit. The markets are saturating, especially in the most lucrative markets. So what does that next lever of growth look like? And I often wonder, is there a different business model that can still be paid, but still addresses and gets music to the right people but make sure that everyone is accounted for, especially just given that it slowed down quite a bit with where the current business model is for the industry.

C (8:56)

We you were talking about the beginning of itunes and us being in the music business since then. Apple is going to be 50 years old next year. And for us, it feels like we've been in the music industry for 50 years, because if you think about how Steve and the management team has built a company and built tools like GarageBand Logic or Build software into sort of the iPhone, we run the company with creators and artists in mind, and that's singer, songwriters, but also photographers, filmmakers and so on. So we've always been very focused on the creative community and we look at music as art, just like a movie or a painting. And that's why we're the only company in the world in the music distribution business that doesn't have a free service, because we honestly don't believe in giving away music for free. Obviously, other people have built a great business of giving music for free, so you might argue we're missing out on that. But it's a philosophical issue for us. We don't think it should exist. And one of my other responsibilities at Apple is I run the TV business. And if you wanted to watch Severance, which hopefully many of you have seen the Beginning of the year, or the studio or any of our other shows, guess what you have to do? You have to pay 9.99 now $12.99 to watch them on Apple TV Plus. And look at what the movie streaming services and the film streaming services have. They have advertising tiers, but none of them are free. We just don't believe in music being given away for free. We're not in that business. So I don't want to speculate for others what other business models there are. We're very much focused on paying the artists fairly. We pay every artist the same. We pay every label the same headline rate and all these things. We have a very simple proposition. It doesn't matter whether you're big or small with us, and we think that's the way it should be. But I don't want to speculate what other people could do.

B (10:43)

Let's take a break for our chart metric stat of the week. Cardi B just released her sophomore album, Am I the Drama? Which comes seven years after her debut album, Invasion of Privacy. But we can't just look at album sales or even touring data to see the success of someone like Cardi B. She's made a lot of money the past few years from brand deals and private events. So for an artist like her, looking at the total reach and impact that she has just from her general awareness is often a better indication for how strong the brand is. So I like to look at Wikipedia views. If you look at the summer of 2025. On the average day, Cardi B had between 5,000 and 6,000 views on her page. But on September 16, 2025, the day her album came out, and the day that her CBS interview with Gayle King dropped, where she announced that she is having her fourth child, this one with Stefon Diggs. And she had a viral soundbite about how many kids that her ancestors had when they came up to the US that day, her Wikipedia page had over 130,000 views. That's the type of attention that someone like Cardi B has values given how much money she makes from brand deals like the recent ones that she's had. If you look at her Instagram, you'll see ones with DoorDash, Welch's grape juice and plenty more. And the private gigs that she does around the super bowl and other big events like that. Every artist has their way of monetizing their business and Cardi B has one of the more interesting ones, especially for an artist that's younger in their career. Let's get back to the episode.

A (12:22)

I keep hearing people talk about the push for advertising, not free advertising, but I think one of the label executives talked about a light tier that's still paid but has ads on it. No different than how Netflix works. It's paid, it's there. And I know that you all aren't an anti advertising company. Of course not. We'll talk about some of that in a bit.

B (12:42)

And I know that it's a broader.

A (12:43)

Decision, but it feels like if we're thinking about where the world can grow this type of product, that's the type of direction or things like that about where things could go in streaming to next chapter.

C (12:53)

That's the exciting thing. It's been only 10 years for us, so we have decades to come and there's lots of room to growth, especially in international. So we're excited about the future. We're really very optimistic.

A (13:04)

And I know one of those parts of the future, of course everyone's talking about AI. You all have some new developments that will be coming out, but with AI specifically so much of the conversation right now, I keep hearing people go back to this quote about this is the Napster era. This is the Napster moment that we're in. And if anyone would know what the Napster moment is, it's the former VP of Marketing at Napster, Oliver Schuster. So it'll be good to get your take on that. Do you feel like that's the moment.

B (13:32)

We'Re in right now, by the way.

C (13:34)

I've not heard that quote from anyone but you, but thank you for reminding me of my Napster days. It's true. I was at Napster in the early 2000s and it was a little ahead of its time, but it wasn't terribly off from where we are today in terms of what we wanted to build. Obviously, we're big believers in AI. I look at AI in three categories. First of all, AI is going to be really awesome for us to make better products. There's so many things in music that AI can just facilitate that will for our customers, just build a better version of Apple Music. And we've already announced and we're shipping some of these things. We have a new feature called Automix, which is one click of a button and it mixes your playlist as if you had a virtual DJ in your pocket. And we've been beta for the last three months. I think we have millions of people on the beta and the feedback has been actually really good. One of the most popular features in Apple music is lyrics. And now we're shipping lyrics, translation and lyrics pronunciation. We couldn't do that feature without AI. It just wouldn't be possible. It would be economically way too expensive. And there's more like natural language search. Like a year ago, if you search on a music service like Apple Music and you search for I don't know who won the Grammy for Best Song, none of the services would find the answer to that. These are just little examples of how I'm a big believer that AI can make our products better. And we're actively working on it. It's a huge priority now. Everyone thinks, oh my God, it has to happen right now. I think AI will take a little bit of time. No one's actually done anything really meaningful in AI in our space. So everyone's experimenting. I think we've got some good stuff that we've already announced. Customer feedback has been great and we ship more things and that's good. The second thing is, I think AI will be tremendous for the creative community to help make music. It will bring more people into the space, allow more people to make music, and I think that's awesome. And if you think about GarageBand and Logic and if you added more AI tools to that, that can only be a good thing. But then the third thing, which is very much talked about is obviously the dangers of AI and the risk that people see steal intellectual property or voice or an image or cover art. And we have a huge responsibility as an industry to prevent that from happening. We're investing significant engineering time again with AI. Ironically, it's poetic to make sure that we identify AI and we make sure that there's nothing on our service that shouldn't be on the service where people have actually stolen something. And that's an ongoing responsibility that hopefully we as a company will be very well positioned in.

A (16:02)

And of course, it takes a lot of folks in the industry to have a strong solution there. And a number of the talks we've had in some way always stem back to AI, at least on this stage for today. But I want to switch gears a bit and I want to talk about sports. A few years ago, Apple Music became the lead sponsor for the super bowl halftime show, took over from Pepsi. The deal at the time was reported.

B (16:27)

That this wasn't reported from you all.

A (16:28)

It was reported publicly though, that it was a $50 million a year deal. Pepsi essentially says, this is too rich for our blood anymore. Let's go to digital advertising. So I'm curious from your end, when you look at a partnership in a deal like that, what are you looking for that tells you this is a success. This is helpful for us. If the deal comes up, let's continue this. This is the ROI we're looking for, sponsoring an event like this.

C (16:52)

It's a very good question because as Apple traditionally, we don't really sponsor anything. We always believed in itunes and Apple Music. We wanted there to be more than just the songs, just the music. And believe it or not, we've done live events since 2014. We did the first one in London. I was based in London with the Stereophonics and the Apple retail store that had just opened on street. And it was a concert that we recorded and put it on itunes. And that became a monthly concert series. And then from 2007, for 10 years, we ran a festival in London. Every year we had over the 10 years, more than 600 artists on stage, all recorded, all put on itunes and later on on Apple Music. And the only reason why we stopped the festival is because we felt like we wanted to try something new. And so one of the things we did was we have on Apple Music we have a concert series, it's called Apple Music Live, which are exclusive bespoke live concerts. We have about six to eight a year, so not quite every month, every other month. And they get a lot of streams, both audio and video, and they're very popular. And we have live concerts in our radio studio. So for us to be in the live space is very normal. We're not in the ticketing business. We're not in the concert business. We host and run a lot of live events. And if we look around, what are the biggest live events in the world? The super bowl halftime show stands out by like a country mile. It's viewed by more than 200 million people. And if you look at the grammys, call it 20. I don't want to comment on the numbers, but it's like a tenth of that as maybe one of the next biggest events. And so for us, when this opportunity became available, it was an obvious thing for us to look at it. And our goal was we like to be involved in the biggest music moments in the world. And our goal was to help to make the halftime show bigger and more global. We had three years. We had Rihanna in year one, Usher year two, Kendrick in year three. All three have broken the records for the biggest show there was.

A (18:42)

Just won an Emmy.

C (18:43)

Exactly. Just last weekend we won an Emmy. Actually, all three of them have been heavily Emmy nominated and winners. So we're super proud of working with Roc Nation. They're fantastic to work with. We have a great relationship with DEZ and with Jay Z and with the NFL as well. So it's really between the three companies. It's an amazing project.

A (19:00)

Yeah, it's definitely been cool to see. I think the production level of these shows just continue to get better and better. I know, as you mentioned, you also oversee other sports content as well. Would you say the ROI is similar for those? If you're looking at MLS deal or even some of the other ones. I know that Amazon and some of these other companies are spending how much money on NFL games and packages? I'm sure you look at all those deals, but like you said, you're probably maybe a bit more selective over what you choose to invest in. But how do you make those decisions? Is it similar to how you look at the halftime show?

C (19:33)

Well, the halftime show and you got your numbers a little wrong, but I won't comment on that. The halftime show is really marketing and we're very happy with it and it's a fantastic project. And again, the working relationship with the artists and with the companies involved has been great. You hinted at Dan. One of the other responsibilities that I have is to look after our sports business. That's actually a little different than the halftime show at Apple. We're huge sports fans. Oh. Have always been. Even though we've never been in the sports business. What we realized, though, is today it's a really tough time to be a Sports fan. Because if you want to follow a sport or a team, very often you have to sign up to multiple services to watch all the games. And then because these games are split across multiple services, there's very little innovation. And many people still watch sports today the way we watch sports 10 or 20 years ago. And sports is the ultimate unscripted drama. It's the best thing on TV because it's just exciting. You never know how it's going to end. And so we went in and decided we wanted to do some sport broadcast tiers where we can make a difference and we would, where we can innovate. And there was an opportunity. Friday night baseball is. They have a Friday night slot where they were really open to integrating like iPhone camera technology with the umpires and on screens they were really focused on innovating with the graphics and just really up level the broadcast in a meaningful way. And that's been a fun project to work on. And that Major League Soccer, we did a deal where for 10 years we're going to have all rights everywhere around the world and completely revolutionize how people watch soccer in this country. Because before us it was all split up in different packages with blackout windows and you couldn't travel internationally to see any of the games. The broadcast was low quality and low res. So I think we made a huge difference and we're looking at very few opportunities how we can innovate and just give customers a better experience. And we look at that as business as well. So we would only ever do deals where we think we can make a significant business for Apple because especially just.

A (21:31)

With all of these companies that are investing these rights. Obviously everyone has their own ROI machines with it, but some of these numbers for some of the things that I'm sure you look at are just so astronomically high. At some point there just has to be some belief in the Lindy effect of okay, this just continues to get bigger and bigger. It does seem MLS and MLB seem to be a bit more measured. I guess I'm more asking on a broader market landscape, not necessarily just Apple, just where these types of deals are heading specifically since you sit in a seat of evaluating them.

C (21:58)

Well, obviously these, these deal valuations gone up and up and we have largely not participated in that. We're looking in places where we can make a difference. And as I said, most companies are in sports because they want to sell something else, whether it's washing machines or I don't know what. We're in sports business to actually make those businesses successful. Not because we think we could sell more iPhones or iPads or anything else. And so we're very focused on just meaningful business decisions.

A (22:24)

So we have maybe about one or two minutes left. A couple rapid fire questions if we have time. Speaking of sports, I know you're a fan of F1. How many times have you seen F1?

C (22:35)

Oh, I've seen we for those of you who don't know, I've done a movie with Brad Pitt that's called F1, the movie that sort of sits at the intersection of everything. I love him, life. I figured I I love sports, I love TV and I love music. It has a great soundtrack and we're very happy that Tate won actually a VMA on Sunday. It is a fantastic movie. It's done incredibly well, past $600 million in box office. So we're super happy. And most importantly though, customers walk out of the cinema and they all vote that they love the movie. So I've seen it seven times, six times in a cinema, one time at home for download. If you haven't watched it, it's a great movie. And again, it's now the most successful sports movie of all time. It's the biggest Brad Pitt movie all time. It's been a fun project to work on and Apple TV plus we've launched it now six years ago, is a huge priority of mine and a huge priority for Apple and this has been one of the many things that I think the team has done an incredible job with.

A (23:27)

Good to hear. Oliver, I appreciate you making the time to make this happen.

C (23:31)

Thank you for having me and thank you all for being here.

B (23:35)

That is a wrap for my conversation on stage at the trapital Summit with Oliver Schuster. Thank you again to Oliver and the Apple team for for making the time to help make this happen. Thank you to Shaun T. Smith and our team on site at the trapital Summit for capturing audio and video. And thank you again to our producers G and Eric for the weekly work that you do to help make this episode possible. And thank you again to our partners who helped make the trapital summit possible. Rain 2, Lost, Luminate, Soundcloud, Live Nation, Urban Beat Bread, Splice, Warner Music Group and more. We couldn't have done it without you. And most importantly, thank you for listening. If there's one person you know that would really enjoy trapital, send them a link to the show. Word of mouth is still the best way to grow. And if you haven't already, leave a review, leave a note about the show that helps more people find out about Trapital and help make sure the algorithm does its thing and it reaches the right people. Thanks again. Talk to you next time.