“The failure of iTunes Radio to halt the decline of music downloads has prompted Apple Inc. to consider the most dramatic overhaul of its iTunes music store in more than a decade, according to executives familiar with Apple’s internal deliberations,” Ed Christman and Alex Pham report for Billboard. “iTunes Radio, which launched in September with much fanfare, so far only sees about 1%-2% of listeners clicking the buy button, while overall music downloads have been declining upwards of 15%, according to several label executives.”
“At the same time, Apple is finding that its influence over labels is slipping as YouTube, Spotify, Pandora and other streaming services gather momentum,” Christman and Pham report. “One independent label said that iTunes’s share of the label’s revenue has eroded from more than 70% in 2012 to about 50% today.”
“As a result, Apple is being forced to consider options that would have been out of the question a few years earlier – an on-demand streaming service, an iTunes store for Google’s Android devices and negotiating download sales windows that favor Apple as first reported by Billboard,” Christman and Pham report. “Apple faced a similar juncture in 2003, when Steve Jobs agonized over whether to make iTunes compatible with Windows PCs. When he finally relented, Jobs announced iTunes for Windows by saying, “Hell froze over.” The decision facing iTunes today regarding Android weighs no less heavily on Jobs’ corporate heirs.”
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