Apple expanding music service to attack Pandora?
Company said to be in talks to expand deals with music publishers, to support highly personalized music streaming service
Published: 10 September, 2012
Music and maps are at the heart of the mobile competition this season and most of the big names are launching or enhancing their cloud music services. In the wake of moves by Samsung, Nokia and Google, Apple is reported to be readying an online streamed service far more tailored to user's personal preferences than its existing offerings.
This would see Apple go head-to-head with popular independents like Pandora, sources told Bloomberg, and the iPhone maker has reportedly already held talks with music publishers about acquiring the necessary rights. However, these are not sufficiently advanced to point to a launch this week with the new iPhone.
Apple, of course, dominates multiscreen music with iTunes, whose store has over 400m accounts. But the iOS giant has faced dilemmas as the market has shifted away from the download model which made its content fortunes, to streamed and cloud alternatives where pricing and profit strategies do not fit the original Apple mold. The company has expanded its cloud support, especially since Tim Cook took over as CEO, but is now looking to regain the initiative by going heavy on personalization.
For instance, it could launch an internet radio service which allows users to create online stations based on their favorite artists, songs or genres, easing discovery and stimulating purchases. Apple wants to strike a deal directly with record labels to gain expanded rights to songs, the Wall Street Journal reported. The radio service may be supported by Apple's iAd advertising network.
Pandora, and rivals like Spotify and ClearChannel's HeartRadio, pay a fixed licensing fee in the US, set by the government, and this comes with restrictions on user choices, for instance how often a song can be heard. Apple's direct approach would remove many limitations, if it succeeds in negotiating the amended terms with its music partners.