Thursday, November 20, 2014

Apple Beats/iPhone Bundle Tries To Counter Music Key

Apple Beats image
The Financial Times is reporting that Apple plans to bundle its newly acquired Beats Music service into an upcoming version of iOS, making it instantly available to hundreds of millions of users. This news should come as no great surprise, since the company originally bought Beats with the intention of doing exactly that. What is interesting is the timing of the leak, however.

As I wrote in my last post, a beta version of YouTube’s new Music Key service has just been introduced, and that provides a far greater threat to Apple’s position in the music business than other services like Spotify and Pandora ever will. Considering that YouTube is the number one online source of music consumption, and that Music Key provides audio and video (with no adverts either) as well as the full Google Play library, Apple’s iTunes service faces a clear and present danger of being majorly usurped as far as market share goes.

For Apple, the real threat is that Music Key will hit the market in full stride before it can roll out the next Beats-baked iOS. Guess what? If too many people get a taste of Google’s offering, they’re not coming back to iTunes any time soon.

Apple suddenly finds itself in a dilly of a pickle in that even though it has those reported 800 million credit cards on file and a built in audience in iPhone and iPad users, the music side of the iTunes is shedding sales faster than even CDs. Read more on Forbes.

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