Apple's 'iRadio' Service Could Be Delayed As Music Labels Have Doubts About Latest Offer
May 9, 2013
Apple has hit a significant snag in their quest to bring their long-rumored “iRadio” streaming music service to market. Despite signing Universal Music, Cupertino has been unable to complete deals with Sony Music and Warner Music, according to The Financial Times.
In April, Apple looked all but certain to be nearing streaming music deals with each of the three music labels. However, some are now balking at Apple’s latest offer, believing that by holding out they could get more. It is believed that Apple has offered a royalty of about 12.5 cents for every 100 tracks streamed. This offer is in line with the rate paid by Internet-radio service Pandora, and more than double what Apple had originally wanted to pay.
Some music executives believe that Apple should pay a higher rate than Pandora, because of their broader ambitions for iRadio. These include “using data it already has from hundreds of millions of iTunes users to predict the selection of tracks they will enjoy, and a plan to allow listeners to purchase songs seamlessly via the iTunes store.”
Apple was expected to unveil iRadio at their Worldwide Developers Conference (WWDC) in June. However, this news puts that plan in jeopardy. While Apple could simply delay iRadio’s launch in order to secure the deal they want, that might not be feasible. Google is expected to unveil their own streaming music service later this summer. A delay for iRadio could “play into the hands of Google,” according to the report.
It will be interesting to see how this plays out. Most likely, an agreement will be reached in time for WWDC. Otherwise, both sides could be facing a significant loss. We'll keep you updated.
See also: The AppAdvice Week In Review: Is Twitter #Music Apple's iRadio Lite? Edition.