Apple iTunes streaming radio service delayed after talks with music labels stall, sources say

“Apple has opened talks with record labels about getting rights for a music-streaming service — but has gotten plenty of push back because its offer is seen as way too cheap,” Claire Atkinson reports for The New York Post. “The tech titan, the most valuable company in the world, made an initial offer to the label of about 6 cents per 100 songs streamed, sources said.”

“That’s about half of the 12 cents per 100 songs paid by Pandora, the leading online radio service that Apple is taking aim at, sources said,” Atkinson reports. “‘Apple wants a rate that is lower than Pandora’s,’ said one high-level executive.”

MacDailyNews Take: Of course they do; they’re going to stream millions upon millions more songs than Pandora.

“While the labels would admit Apple’s music service could tap a whole new revenue stream for them, they are loath to say yes to the offer as the industry is fighting on Capitol Hill to prevent Pandora from lowering its current rate, sources added,” Atkinson reports. “Music label insiders suggest Apple — which is sitting on a cash hoard of roughly $137 billion — ought to pay at least the rate set by the Copyright Royalty Board, or about 21 cents per 100 songs streamed.”

MacDailyNews Take: Keep dreaming.

Atkinson reports, “Apple views radio as a way to make better use of its iAds advertising platform. An Apple iRadio product would be ad supported. The music labels, for their part, want an upfront fee and a percentage of that ad revenue in addition to the streaming fees, said sources… Apple is considering a launch of iRadio as part of a bundle along with iMatch, which allows iTunes users to make their music available on all iOS devices.”

MacDailyNews Take: She likely means “iTunes Match,” Apple’s subscription scan and match music service.

Read more in the full article here.

“Apple delayed the start of an online radio service to compete with Pandora Media Inc. after talks with music labels stalled,” Andy Fixmer and Adam Satariano confirm in a report for Bloomberg, citing “four people with knowledge of the situation.”

“The company still seeks to start the advertising-supported radio service by the end of the year, said the people, who asked for anonymity because the plans haven’t been made public,” Fixmer and Satariano report.

MacDailyNews Take: When everyone finally arrive at the terms, as long as “The 1975” are on it, we’ll be good to go. (It’s all we’re playing lately. Blast away if that’s your wont.)

Related articles:
Apple’s ‘iRadio’ imminent? ‘Radio Buy Buttons’ found in iOS 6.1 – February 5, 2013
Analyst: No ‘Apple Television’ this year, but ‘iRadio’ on the way – January 3, 2013
Apple’s iTunes radio should pump up heat on Spotify, not Pandora – December 3, 2012
Analyst: Apple to launch ad-supported ‘iRadio’ music streaming service next year, before ‘Apple iTV’ – December 3, 2012

17 Comments

  1. in 2013, I just don’t get the whole Pandora/radio-streaming business model..nearly everyone already has every song they’d ever want, what is the benefit of streaming ad-supported music to the user? I just do not see it.

    1. Same as ever: music discovery.

      Must be a shame to be stuck in a time warp and you can’t bust out..

      Hello? It’s the 1970’s calling, and they want their music back!

    2. “nearly everyone already has every song they’d ever want”

      Funny thing about music, they keep making more.

      Pandora has a free ad-supported service and a paid no-ad service. There aren’t that many ads in the free service and the paid service is only $3 a month. Either way, it’s a really great service.

      Pandora is available not only as a mobile app, but also on your desktop, Sonos, most AV network receivers, smart TVs, etc… They all can share the same account.

      It works very well for music discovery, as it’s “smart radio”. Unlike dumb radio stations, you can develop your own channels by feeding variables into it and then discovering all kinds of artists you never knew existed but match the same criteria.

      Really, Pandora is pretty awesome.

      But I could see Apple doing something pretty amazing in this field as well.

  2. I use Wunder Radio. Fantastic app. Been using it since iOS 2. I can’t find the price, since I own it, but I think it’s $3.99. Get yourself Wunder Radio today!

  3. Ok, Apple has always had streaming audio files in iTunes for as long as I can remember. So, this one will come from Apple. Ok, what about the other thousand or so in iTunes now? Apple should just set their service and if the artist wants their songs on there great. If not pick one that does. They will deal with Apple when they are ready. The first in are the artists that get paid using Apple’s terms. The others get $0.00. No one needs to force them to get money from Apple.

    1. You beat me to it. It’s what Apple should do with everything in iTunes. They should get rid of the 5 computer limit for an account. Whoever doesn’t like it can go sell their crap on Dell’s music system. Are music videos still protected? Do away with that. Whoever doesn’t like it can go sell their crap on a Surface RT music system. Apple is not giving us users “the best experience possible” — and I’m not really even talking about DRM stuff or wanting to steal things. I’m just talking about all of the hoops we have to jump through, or stuff we have to wait for, because some corporation that can’t make any money on their own, keeps wanting a better deal. Just turn everything on and let the chips fall where they may.

  4. What’s all this talk about being delayed? Apple has never officially announced a streaming radio service to begin with that I can recall. And Apple wants to get the best price it can so more people will use it versus other services like Pandora. So naturally they are going for the lowest price they can. Bidding higher than the competition is paying for wouldn’t help Apple’s service at all obviously.

  5. Similar issues to the label’s initial resistance to Job’s iTunes negotiations. In the end, it was the best deal these lame execs ever made.

    Time has proven that without Apple there would be no more labels…

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