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Old May 9, 2013, 02:23 PM   #1
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Apple Still Negotiating With Sony and Warner Over iRadio Royalties




Apple is still in negotiations with Sony and Warner over its iRadio streaming music service, reports the Financial Times. Apple had offered roughly 6 cents per 100 tracks streamed, but later reportedly raised this to 12.5 cents per 100 tracks -- similar to the rate paid by Pandora.

Although the company has reached an agreement with Universal Music, the largest record label, the FT claims other labels are still looking for better terms. Apple is reportedly working hard at reaching a deal and wishes to launch the 'iRadio' service at some point this summer, perhaps at WWDC in June.
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Some music industry executives argue that cash-rich Apple should pay a higher rate than Pandora, which had 70m "active listeners" in April, because of its broader ambitions for iRadio. These include using data it already has from hundreds of millions of iTunes users to predict the selection of tracks they will enjoy, and a plan to allow listeners to purchase songs seamlessly via the iTunes store.

The people familiar with the terms said that Apple was offering labels three tranches of revenue: a royalty per track streamed, a share of iRadio's advertising revenue and a guaranteed minimum sum over the course of the contract that would provide a safety net in case the number of plays or amount of advertising sold disappoints.
The FT notes that Apple is intentionally not launching an on-demand service like Spotify in order to avoid cannibalizing purchases from its iTunes Music Store. Instead, the iRadio service will allow customers to discover new music and likely direct listeners to the iTunes Store to buy music they enjoy.

Article Link: Apple Still Negotiating With Sony and Warner Over iRadio Royalties
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Old May 9, 2013, 02:25 PM   #2
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Hopefully it's announced at WWDC!!
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Old May 9, 2013, 02:26 PM   #3
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If it isn't one company that's greedy, it's another...how about being pro consumer for once! Without us, these companies are no where.
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Old May 9, 2013, 02:27 PM   #4
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I hope licensing issues are resolved sooner rather than later, Apple needs this
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Old May 9, 2013, 02:30 PM   #5
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As a high school student, I can say everyone I know quit using iTunes and uses Spotify exclusively now. That's what Apple needs to compete with, NOT Pandora. In other words, you should always be able to pick the song like Spotify.
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Old May 9, 2013, 02:32 PM   #6
tann
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An on demand Spotify like service is the exact thing that I would absolutely love! I love Spotify but for some reason even in offline mode it seems to drain my battery a lot faster than the regular music app.
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Old May 9, 2013, 02:33 PM   #7
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Quote:
Originally Posted by Aussi3 View Post
Hopefully it's announced at WWDC!!
WWDC isn't really the venue for that. I'd expect it to be announced at the fall music-related event. (If this is even something Apple ends up pursuing).
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Old May 9, 2013, 02:34 PM   #8
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Quote:
Originally Posted by aheying7 View Post
As a high school student, I can say everyone I know quit using iTunes and uses Spotify exclusively now. That's what Apple needs to compete with, NOT Pandora. In other words, you should always be able to pick the song like Spotify.
As a college student, I agree with you completely.

Something weird I've found: I listen to a lot of music on Spotify on a free plan, and about once a week I find a song I like so much that I buy it on the iOS music store just so I can listen to it on my iPhone. So Spotify basically is doing all the work of convincing me to buy the song, but then Apple is the one collecting the money when I decide to buy it.
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Old May 9, 2013, 02:36 PM   #9
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all apple needs to do is register a patent for one of the notes. problem solved
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Old May 9, 2013, 02:39 PM   #10
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The FT notes that Apple is intentionally not launching an on-demand service like Spotify in order to avoid cannibalizing purchases from its iTunes Music Store. Instead, the iRadio service will allow customers to discover new music and likely direct listeners to the iTunes Store to buy music they enjoy.
In short, wouldn't this be aggregating music, which pretty much goes against the very policy Apple adopted to crack down on apps like AppGratis, Appshopper, etc.?

If so, this smacks of hypocrisy/"do as I say, not as I do".

BL.
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Old May 9, 2013, 02:40 PM   #11
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I think Spotify (or other services alike) are the future. Still, I do see why Apple won't cannabalize the iTunes store.
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Old May 9, 2013, 02:44 PM   #12
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Originally Posted by ArtOfWarfare View Post
Something weird I've found: I listen to a lot of music on Spotify on a free plan, and about once a week I find a song I like so much that I buy it on the iOS music store just so I can listen to it on my iPhone. So Spotify basically is doing all the work of convincing me to buy the song, but then Apple is the one collecting the money when I decide to buy it.
Hahaha. Yes, exactly the same for me.

I listen to Spotify or Pandora to find music, and use iTunes to buy the music I listen to most.
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Old May 9, 2013, 02:46 PM   #13
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I really can't see why so much effort is being used for what seems like a fairly weak proposition.
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Old May 9, 2013, 02:50 PM   #14
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if they had more subscribers, iTunes/Apple model should be cheaper right? like buying in bulk...
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Old May 9, 2013, 03:00 PM   #15
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Apple is intentionally not launching an on-demand service like Spotify in order to avoid cannibalizing purchases from its iTunes Music Store. Instead, the iRadio service will allow customers to discover new music and likely direct listeners to the iTunes Store to buy music they enjoy.
Tim Cook, 1/23/13:

“I see cannibalization as a huge opportunity for us,” Cook said Wednesday. “Our core philosophy is to never fear cannibalization. If we don’t do it, someone else will."
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Old May 9, 2013, 03:02 PM   #16
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I really can't see why so much effort is being used for what seems like a fairly weak proposition.
I'm with you. A better Pandora doesn't seem like much of a "next big thing". I don't get how "Apple needs this" and similar. I'm sure it will be nice and probably have a few benefits Pandora has missed. On the other hand, I'm sure it will have some "why'd they do that?" lock-down that Pandora doesn't match.

But I can't think of anything here that could be "revolutionary." It's like we're chasing a fading medium of music distribution in hopes of reviving it. Maybe after this rolls out, Apple can go into the VHS tape rental business. That was hot 10+ years ago and, with the Apple spin, maybe they can turn it into something too.

Similarly, I read that bit about the ad revenues and I wonder why people are going to want to both (potentially) pay something for this service AND listen to ads rather than just play the playlists of music they like on their iDevices for free. Yes, there's something to be said for discovering new music but we already have Pandora and Spotify for that. Is the convenience of one-click purchasing really all that? If so, we're excited to pay for something with ads so that we can easily pay for something else when we hear a song we like. Pay for the opportunity to conveniently pay more. That's innovation!

Could we use LTE to download all of this music we're paying to get to pay for so that we can burn through our data allocation even faster? That way we can pay for the convenience of getting to pay for songs and getting to pay AT&T, Verizon, etc even more because this is yet another "innovation" that seems to revolve around burning through hard-capped data as quickly as possible. Win for Apple. Win for AT&T, Verizon, etc. Win for Music Studios.

Anyone noticing a trend in iDevice innovation over the last couple of years? What does SIRI, Maps, and probably this iRadio all have in common? Hint: think about data burn vs. hard caps set by AT&T, Verizon, etc. Has Apple iDevice innovation pretty much moved to a filter involving what else could be developed to burn through capped data even more quickly?

Last edited by HobeSoundDarryl; May 9, 2013 at 03:16 PM.
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Old May 9, 2013, 03:03 PM   #17
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Some music industry executives argue that cash-rich Apple should pay a higher rate [...] because of its broader ambitions [...] and a plan to allow listeners to purchase songs seamlessly via the iTunes store.
Charge Apple more because they might bring in additional revenue. The music industry doing it what it does best.
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Old May 9, 2013, 03:07 PM   #18
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I think this is major for Apple, if they can integrate this into iOS. I use itunes match and love it but having this seems like it would put even more music at my fingertips. Wonder how it would affect the battery...
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Old May 9, 2013, 03:15 PM   #19
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Xbox music Pass is the music service to beat!
Wonderfully integrated with their smartphones and Win 8!
It is very close to perfect! (only the design of the music app is not that good - okay, it's bad)
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Old May 9, 2013, 03:17 PM   #20
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if they had more subscribers, iTunes/Apple model should be cheaper right? like buying in bulk...
Maybe they can make it like the cable tv scam where you pay a monthly fee AND have commercials!
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Old May 9, 2013, 03:25 PM   #21
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That seems to be the plan. Except in that model, there isn't an added bill if you watch too much television (data) in a given month. In this plan, you can pay for the service, have commercials and if you use enough data to go through your cap you can pay some more. Triple threat. Everybody (that is a corporation) wins.
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Old May 9, 2013, 03:30 PM   #22
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Hmm

Maybe Apple shouldn't have low-balled them in the 1st place, then maybe they'd be more open to faster, friendlier negotiations.

I still don't understand services like spotify or pandora. Having a "radio" service is convenient at times, but I STILL like to buy and OWN (despite how some people interpret music purchases) my music.
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Old May 9, 2013, 03:37 PM   #23
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Conjecture all day what you think it should be or what you want. Apple will deliver what they want and what they think you need. Never been any different, has it?
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Old May 9, 2013, 03:37 PM   #24
Gym Hellwig
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Who cares about this crap? Nobody wants another streaming radio service.

Spotify will eat an Apple for lunch.

Last edited by Gym Hellwig; May 9, 2013 at 03:53 PM.
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Old May 9, 2013, 03:38 PM   #25
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Originally Posted by aheying7 View Post
As a high school student, I can say everyone I know quit using iTunes and uses Spotify exclusively now. That's what Apple needs to compete with, NOT Pandora. In other words, you should always be able to pick the song like Spotify.
Well said. Spotify is the true rival here.
Spotify > Pandora
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