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.
Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.You should follow me on Twitter for daily news and updates on production and the music business.
Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.