Recent reports make it seem more plausible that Apple is planning a music streaming service, a rumor that’s been making the rounds for years. According to a report by CNET this week, Apple is close to making deals with multiple record labels, and it could launch a service as early as this summer.
This service, sometimes referred to as “iRadio,” would most closely resemble Pandora. The service would function through iTunes and allow users to purchase songs they hear and like immediately directly from the service, something no other streaming music service is currently able to offer.
Also according to CNET, the music industry is intrigued by Apple’s proposal because it knows the pull Apple has when it comes to digital content and it is confident that Apple will create an easily accessible app for its iPhone. The service would reportedly be available on desktops and mobile devices, meaning users could expect support for both their iPhone and iPad devices.
Apple is reported to have deals on the table with both Warner Music and Universal Music Group which could be signed as early as next week. However, Apple would likely need to get Sony Music Group on board before iRadio could become a reality.
Royalties a Sticking Point?
The question for music labels lies in where they will find their profits. According to a report by TUAW, the royalties Apple wants to pay labels for each music stream played is a fraction of what Pandora gives them, and this could be a major sticking point when it comes to striking a deal.
However, the ability to purchase songs straight from the service and Apple’s promise to sell lucrative advertisements could make the service more than worth it for the record companies.
Nothing has been confirmed by either Apple or the record companies, and even if the rumors are true, the entire deal could still fall apart.
A music streaming service would push Apple into an area that is already crowded with services like Pandora, Spotify, GrooveShark and Rdio now on the market. Google is also reportedly working on a music service that would function on desktops and mobile devices and another service within Google Play.
Amazon is rumored to be developing a music streaming service, as well. Amazon’s service would be an on-demand service and the company already has the infrastructure in place to make such a move with its existing cloud music storage and Cloud Player.