With the Worldwide Developers Conference nearing next week, Apple has been scrambling to secure licensing/publishing deals in order to launch its subscription music service, dubbed “iRadio.” After months of stalled negotiations, Apple finally struck a deal with Warner Music Group and its publishing branch, Warner/Chappell Music. According to the New York Times, Apple managed to secure rights on Sunday for publishing and recorded music.
Apple’s late arrival into the music streaming field will heighten competition from already established streaming companies – services like Pandora, Spotify, and Google Play Music All Access (Google’s new subscription music service that launched last month) all contribute to the fast-growing sector of the music business. Apple’s iRadio is thought to be similar to Pandora, tailoring each stream to the individual user’s taste. Based on previous reports from TechCrunch, Apple’s service is suspected to be free but ad-supported. Also, CNET has mentioned that the product is made for mobile devices and is closely related to iTunes, where the user can rewind a song or simply click a button to purchase it.
Last month Apple reached a licensing deal with Universal Music Group, the world’s largest record label, yet no publishing deal was made. Furthermore, Apple is still at a standstill with Sony Music and its publishing arm, Sony/ATV, whose artists include Lady Gaga and Taylor Swift. Through these talks, Apple aims to secure more extensive licensing terms for its music library. However, the remaining labels do not want to replicate existing deals they have with Pandora, which according to the New York Times, is a real sore spot for the companies because they only receive 4% of revenue – the labels are looking for as much as 10% from Apple.
According to TechCrunch, it is very likely that Apple has the technical aspects of the streaming service figured out but is awaiting a green light from the record labels. Apple is pushing to complete the remaining deals with the music companies and, if successful, we will see the big reveal next week at the WWDC.
