The New York Post reports that Apple may be trying to hammer out a deal with the major music labels to provide iTunes customers with unlimited access to tracks for a set monthly fee. This information comes from unnamed sources, which seem to be all over the place regarding Apple news lately. I’m considering a macro that’ll type “take this information with a grain of salt.”
The Post tells a tale of Apple’s iTunes head Eddy Cue “on the phone with music honchos as recently as a few weeks ago trying to figure out how the partners can move forward.” The alleged deal would be for two different pricing structures—one for $10 per month and one for $15 per month.
This idea is not new, nor is it radical. In fact, it’s been done time and time again by several music services. Currently Rhapsody does it, Napster does it, Microsoft does it—Apple’s actually quite late to the game.
But two big players may factor in to Apple’s supposed push into the subscription music model—Google and Spotify.
Google Music is still a ghostly apparition at this point, but assuming the search engine behemoth eventually gets into selling music just like it’s gotten into TV, video, and mobile phones, there’s a very good chance that it’ll be cloud- and subscription-based. Google’s got plenty of storage space on fast servers and—bonus—it could serve ads to you whenever you log into its music site to listen to or retrieve your music.
Spotify is more of a wildcard. It’s been hugely successful in Europe and has been trying to break into the US for quite some time, but it’s facing pushback from the music labels for offering free music streaming. Music royalties are structured differently from country to country, so Spotify’s been able to offer an ad-supported free music service overseas—it also offers the ability to get rid of ads for a small monthly fee alongside a more expensive premium plan that facilitates the downloading of music tracks to a computer or phone.
CNET reports the following regarding Spotify:
“Some of the labels are unconvinced of Spotify’s business model and its ability to get people to pay for music; Apple executives have expressed concern to the labels that a free music service here could undercut already lackluster download sales.”
That the labels aren’t big on ad-supported free music is one thing. That Apple has the ear of the labels and is complaining that a service like Spotify could cut into sales is more troubling from a consumer standpoint.
Whatever the case, if Apple goes with the subscription model, it’ll probably be structured similarly to currently-available services. For $10 per month, you’d get unlimited streaming within iTunes and possibly to your iPhone, and for $15 per month, you’d get the ability to actually download the tracks to your computer. Stop paying the monthly fee, and the tracks disappear or don’t play the next time you click on them. It’d be very unlikely for Apple to offer free ad-supported tracks a la Spotify, so it’d have to hope its users aren’t lured away by the temptation of free computer-only streaming.
The streaming bit should be trivial for Apple. It bought streaming music service LaLa earlier this year but has yet to really do anything with it. And the company’s already charged full-force into streaming video content with the new Apple TV. Streaming music from the cloud seems like a no brainer.
So if I’m Apple and I’m catching wind of Google’s music service and the possibility that Spotify might finally be able to crack into the US market, I’d want to get my own music subscription services up and running first. That way when Spotify and/or Google Music hit the scene here, iTunes users say, “I can already do that with Apple. No reason to jump ship.”
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