Beats CEO Jimmy Iovine Pitched Steve Jobs on Subscription Music Service

[MacRumors]

In a new interview with AllThingsD, Beats Electronics CEO Jimmy Iovine reveals that he is preparing a subscription music service. Although he isn't revealing details yet, he does say that he started pitching the service to Steve Jobs in 2003.

In 2002, 2003, Doug [Morris, former Universal Music head] asked me to go up to Apple and see Steve. So I met him and we hit it off right away. We were really close. We did some great marketing stuff together: 50 Cent, Bono, Jagger, stuff for the iPod -- we did a lot of stuff together.

But I was always trying to push Steve into subscription. And he wasn't keen on it right away. [Beats co-founder] Luke Wood and I spent about three years trying to talk him into it. He was there, not there ... he didn't want to pay the record companies enough. He felt that they would come down, eventually.

I don't know what [Apple media head] Eddy Cue would say -- I'm seeing him soon -- but I think in the end Steve was feeling it, but the economics...he wanted to pay the labels [for subscriptions], but [the fees were] not going to be acceptable to them.

Recently, music streaming services like rdio, Pandora and Spotify have become increasingly popular and Apple is rumored to be working on a Pandora-like "iRadio" streaming service. Iovine mentions that his streaming service would be heavy on curation, like Pandora, rather than simply giving users access to millions of songs like Spotify. Apple's rumored streaming service is said to take the same approach, which makes sense if Jobs did like Iovine's pitch.

Beats and Apple do have a fairly close relationship already, as Apple retail stores tend to use Beats by Dre headphones to demo iPods and other devices.

Article Link: Beats CEO Jimmy Iovine Pitched Steve Jobs on Subscription Music Service

[fruitpunch.ben]

Originally Posted by MacRumors

Apple's rumored streaming service is said to take the same approach, which makes sense if Jobs did like Iovine's pitch.

That would make the service completely useless for me and so many people. I just want to stream all iTunes store's music for a monthly fee. Can it really be so hard? Especially because Apple doesn't see iTunes as a significant revenue source, it is meant to drive sales of hardware, so they do not need high profit margins on such a venture. And before you say "that's un-Apple-like" remember that the iTunes store only just broke even for its first few years - its only now that it has huge revenues. So the streaming service can start the same way, break even, and then as profitability increases, it can make more of a profit without raising fees

[ronwasserman]

To Jimmy and Doug.

Remember in 1999 when you signed my band because we were the biggest thing online?

Remember when you asked me what the future of the music business would be and I said 99 cent singles?

Remember how you both told me that (as well as subscription) services would never happen in your lifetime?

Glad to see you woke up during your lifetime.

It's too late now to implement your ideas in a way that would be as profitable as they would have been a decade ago.

Good Luck!

Ron

[basesloaded190]

Originally Posted by fruitpunch.ben

That would make the service completely useless for me and so many people. I just want to stream all iTunes store's music for a monthly fee. Can it really be so hard? Especially because Apple doesn't see iTunes as a significant revenue source, it is meant to drive sales of hardware, so they do not need high profit margins on such a venture. And before you say "that's un-Apple-like" remember that the iTunes store only just broke even for its first few years - its only now that it has huge revenues. So the streaming service can start the same way, break even, and then as profitability increases, it can make more of a profit without raising fees

iTunes brought in 7.5 billion in revenue for 2012, so I would beg to differ.

[krravi]

Steve has always been a stickler for money.

[Bobtodd]

The only thing "Beats" bring to the Apple store is thieving scum who steal the **** out of them.

[ConCat]

Originally Posted by krravi

Steve has always been a stickler for money.

Aren't we all.

[FreeState]

Originally Posted by Bobtodd

The only thing "Beats" bring to the Apple store is thieving scum who steal the **** out of them.

And incredibly bad headphones that have been marketed brilliantly.

[fruitpunch.ben]

Originally Posted by basesloaded190

iTunes brought in 7.5 billion in revenue for 2012, so I would beg to differ.

After you quoted me I added this:

And before you say low profit margins are un-Apple-like" remember that the iTunes store only just broke even for its first few years - its only now that it has huge revenues. So the streaming service can start the same way, break even, and then as profitability increases, it can make more of a profit without raising fees

[hofer]

I don't like subscription services, period. I don't need another service for which I pay a monthly fee whether I use it or not.

That is why I like the original itunes models. You like a song, and you buy it, No further obligations.

On the other hand, if I were running a business, a subscription service would be great. Nothing like a steady stream of revenue. But IMHO, as a consumer you get screwed unless you are an addict that listens 24/7.

[marv08]

"Recently, music streaming services like rdio, Pandora and Spotify have become increasingly popular and Apple is rumored to be working on a Pandora-like "iRadio" streaming service."

I read this a lot. But nobody gave any details. Exactly, what is the user base and revenue of rdio, Pandora and Spotify? How do they compare to the iTunes Store (members with credit card on file, sales, revenue, profits)? How much do musicians and composers get per song/album?

I personally prefer to buy albums/songs (my purchases are approx. 95% complete albums, the remaining 5% are mainly one-hit acts, ancient hits or simply funny/ridiculous stuff) and give the performers, lyrics writers and composers what they deserve. A great song (or instrumental piece) for 99 cents will be stuck in my brain forever, a $5 coffee in a paper cup turns into piss within a day.

[Klae17]

Time to buy Pandora!

[HenryDJP]

Originally Posted by FreeState

And incredibly bad headphones that have been marketed brilliantly.

So very true!

[krravi]

Originally Posted by ConCat

Aren't we all.

I wouldn't be buying Macs if I was one.

[DJJAZZYJET]

I would even go as far to say that the apple EARPODS sound better than the beats headphones they are so bad.

[ziggyonice]

For a while I was all on board with the "own your music" idea. I bought hundreds of dollars worth of music on iTunes.

But then I tried subscription. A few bucks a month and I'd listen to whatever I wanted to, whenever I wanted to. Streaming on-demand. I could sample whole albums and find new music. Or maybe I want to quickly pull up a song that I don't have in iTunes, instead of having to go through the process of purchasing it. In additon, it meant not having to take up precious space on my iPhone for songs.

You may say, "But you can stream with iTunes Match!" Yes, and I have tried it. In addition to its slow, spotty reliability, it's pointless next to Rdio, Spotify or others.

Why stream my limited iTunes library via iTunes Match when I could go subscription and stream literally whatever song I want, instantly?

I probably haven't bought a song from iTunes in a couple years. I really want to see Apple give people the option for subscription. I'd jump on it in a heartbeat.

[cxny]

Originally Posted by ziggyonice

For a while I was all on board with the "own your music" idea. I bought hundreds of dollars worth of music on iTunes.

But then I tried subscription. A few bucks a month and I'd listen to whatever I wanted to, whenever I wanted to. Streaming on-demand. I could sample whole albums and find new music. Or maybe I want to quickly pull up a song that I don't have in iTunes, instead of having to go through the process of purchasing it. In additon, it meant not having to take up precious space on my iPhone for songs.

You may say, "But you can stream with iTunes Match!" Yes, and I have tried it. In addition to its slow, spotty reliability, it's pointless next to Rdio, Spotify or others.

Why stream my limited iTunes library via iTunes Match when I could go subscription and stream literally whatever song I want, instantly?

I probably haven't bought a song from iTunes in a couple years. I really want to see Apple give people the option for subscription. I'd jump on it in a heartbeat.

Ditto except for the jump on an iTunes version. I'd probably try it but Spotify is some tough competition. I can't imagine Apple " curating" my personal musical taste and getting it close. Reminds me, gotta cancel iTunes Match...

[bungiefan89]

Want to hear a joke?

A guy wearing Beats headphones says Macs are low quality and overpriced.

[summitRun]

Its pretty easy to look in the rear view mirror and see what WAS possible. The reality is that Apple was a failing company in 2002. SJ placed a massive bet on the iPod and totally did the right thing at the time for a somewhat desperate cash stepped company in need of a fresh direction.

To even try and equate this story as some sort of SJ failure is absurd… I mean streaming service to what, in 2002/2003?? There wasn't anything to street to!

Its now TC's chance to look forward. Does he have the vision? I guess we'll have to wait for another decade to find out…

[charlituna]

Originally Posted by fruitpunch.ben

That would make the service completely useless for me and so many people. I just want to stream all iTunes store's music for a monthly fee. Can it really be so hard?

Yes. The labels make it so. They have control nd do everything they can to keep it or get scads of cash for it. Same with the studios and networks

----------

Originally Posted by basesloaded190

iTunes brought in 7.5 billion in revenue for 2012, so I would beg to differ.

But what were the costs required to do that.

----------

Originally Posted by krravi

I wouldn't be buying Macs if I was one.

I am and I still bought a Mac. Why? Because building an AVID rig was even more expensive. So I took a gamble and learned final cut, shake etc instead.

And it paid off.

[iAco]

Steve Jobs was a great.

Now he's dead.

He isn't important anymore. The people of NOW are important.

[YYR123]

Originally Posted by iAco

Steve Jobs was a great.

Now he's dead.

He isn't important anymore. The people of NOW are important.

Yeah

[ArtOfWarfare]

Originally Posted by iAco

Steve Jobs was a great.

Now he's dead.

He isn't important anymore. The people of NOW are important.

You may become less important over time after your death, but it sure isn't an instantaneous thing. Steve Jobs is certainly still important today, despite the fact his body failed him (or he failed it,) over a year ago.

[bwillwall]

Originally Posted by HenryDJP

So very true!

Yup... wearing my wireless beats I got about a week ago right now. Squeezing the hell out of my ears.

[mdriftmeyer]

Originally Posted by ziggyonice

For a while I was all on board with the "own your music" idea. I bought hundreds of dollars worth of music on iTunes.

But then I tried subscription. A few bucks a month and I'd listen to whatever I wanted to, whenever I wanted to. Streaming on-demand. I could sample whole albums and find new music. Or maybe I want to quickly pull up a song that I don't have in iTunes, instead of having to go through the process of purchasing it. In additon, it meant not having to take up precious space on my iPhone for songs.

You may say, "But you can stream with iTunes Match!" Yes, and I have tried it. In addition to its slow, spotty reliability, it's pointless next to Rdio, Spotify or others.

Why stream my limited iTunes library via iTunes Match when I could go subscription and stream literally whatever song I want, instantly?

I probably haven't bought a song from iTunes in a couple years. I really want to see Apple give people the option for subscription. I'd jump on it in a heartbeat.

You haven't bought songs from iTunes Store but quarter over quarter growth clearly compensates for your drop-off.