They aren't giving away their product, they're getting higher royalties overall. Your argument makes sense only if every single artist is going to be releasing

They aren't giving away their product, they're getting higher royalties overall. Your argument makes sense only if every single artist is going to be releasing a new album during this 3 month trial period, and that everyone that subscribes to Apple Music does so when it launches. That's not going to happen and musicians will release music long after the trial period is over, for which they'll be earning a higher royalty.