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Wednesday, September 19, 2012

A Look At Apple's Music Streaming Plans

iTunes logo image
We're learning more and more each day about the planned Pandora-like streaming service planned by Apple (see this post for more info). It appears that Apple is still in discussion with the major labels on the license fee that they'll be paying, which is complicated by the fact that Apple wants to implement some interactive features in the product to distinguish itself from either Pandora or iHeartRadio. This is a complicated issue on so many levels, but suffice it to say that Apple wants to pay the least it can while the labels want the most.

It's been reported that the labels are also demanding a couple of things besides the license fee:
1. A way to refer listeners back to the iTunes Store (like a "Buy" button) to stimulate sales so that the streaming doesn't cannibalize it. I'm sure that Apple would like the same thing, but once this streaming cat is out of the bag there's no reason to own the song any more. In fact, Pandora has the same thing and it's been reported that it hardly throws off any revenue.
2. The ability to program tracks to fit the listener's profile, which they can't do now with Pandora.
2A. There's been some talk of even allowing programming on a geographic basis, which is perfect for an indie artist or band just building an audience.
You can bet that this is going to happen sooner than later despite the fact that Pandora has a huge head start. iTunes has a global customer base of 465 million users, and there are 335 million iPods, iPads and iPhones out there, so their potential reach eclipses everyone else in the market. The problem is, this will be another nail in the downloadable music coffin as consumers get more and more used to renting music instead of buying it.
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3 comments:

Peter Saverman said...

I'd love to see another competitor on the streaming media market but when it comes to Apple I'm afraid that it might be one more service that won't be available world wide. Just look at the iTunes match f.ex.

Alejandro Navas said...

Why do you leave spotify out of this article, spotify is the present and future of streamed music. And by far a better product than all that is mentioned here

Peter Saverman said...

Spotify may be great but there's a competing service called Wimp that has more or less the same music at the same price but the experience around the music is so much greater. That's where I think Spotify lacks a bit.

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