Apple and Sony 'iRadio' Negotiations Stalling Over Skipped Songs

[JAT]

I am pretty sure I heard somewhere that people spend on average 40 dollars a year on iTunes Music. 15*12 is 180 dollars.

That has to include lots of people paying zero, though. For whom a service isn't even on the radar.

Just launch it without Sony altogether, and they'll change their tune.

That would upset too many customers, who would not understand why they can't play a few songs.

So how's that MiniDisc working out for you, Sony?

In Japan it worked out very well. Just not anywhere else.

 

[gnasher729]

Can't skip songs on a service you pay for - the "industry" has gone bonkers. Its all about the money, they don't care what the consumer thinks. I just simply refused to follow them.

The idea is probably that you would pay a fixed amount (possibly zero) to Apple to listen to as much music as you like, and Apple pays the record companies according to how much you listen to. On average, Apple would pay for one song for every four minutes listening time. But if Apple has to pay a full song's worth if you listened to the first five seconds and skipped the rest, you could cost Apple 50 times as much.

There are obviously two solutions to this: Either Apple negotiates that they don't pay for a full song if you listen to five seconds only, or (I think Pandora does that, might be someone else) Apple doesn't let you skip more than a small number of songs every day.

Without that, it could be that for 8 hours of listening Apple pays 120 songs, and for ten minutes of you skipping songs every five seconds Apple also pays 120 songs.

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“Apple is innovating around the same things which, in my mind, is not really innovating,” said Gala Prada, head of pension funds and portfolio manager for Fiatc Seguros in Barcelona, who answered the poll. “There are companies like Samsung — which are taking the lead right now innovating in all kinds of consumer and electronics products — which also make Apple, on a relative basis, look a little bit behind,” Prada said.

That's the kind of person who would know everything about innovation. For heaven's sake, he is a banker, which means he has no brain, no conscience, no nothing except an exaggerated sense of self-importance and self-entitlement.

 

[theanimaster]

They should just leave Sony out and watch Sony crawl back on their knees when the other labels are raking in the dough.

 

[gnasher729]

True, but are you not allowed to change the radio to find another song? Wouldn't that be about the same thing?

The record companies don't mind you skipping songs. They just want to be paid the same amount, whether you listen to the full song or to the first five seconds. Sony would actually love it if you skipped songs all day long, as long as Apple pays a full song's worth of fees for every song that you skipped after five seconds. (Or Pandora, or Spotify).

8 hours music play - Apple pays for 120 songs.
10 minutes skipping songs every 5 seconds - Apple pays for 120 songs.
8 hours skipping songs every 5 seconds - Apple pays for 5,760 songs.

That's what Sony wants, and Apple obviously doesn't.

Wouldn't it be easy to implement a log of at what point a song was skipped and then pay that percentage of the full licencing fee? They're already tracking that songs are being started, why not when they are stopped, too? Then use that data to calculate the percentages to be paid. That would be invaluable data to measure popularity by.

It would be quite simple to measure partial songs played, or possibly just song minutes played (so Apple would pay more for a six minute song than for a two minute song), it's probably just that Sony doesn't want that but wants to get paid for a full song no matter how small a portion is played.

 

[Snowshiro]

The problem is that this would destroy the iTunes download business. Would those $15 fees make up for that? I doubt it.

I dunno. These days a lot of people tend to download individual tracks they like, so $15 of downloads represents more repeat visits to the store than it used to be when you bought whole album. Added to which, every time something like this comes along, it provides a convenient alternative to torrents and takes a bite out of the number of people who would otherwise pirate stuff and pay nothing at all.

 

[samcraig]

What labels are exactly upset? Only one is actually signed. One is "close" to signing - but I don't see how they can get upset that someone hasn't signed yet. Especially since Sony is technically "close" to signing but needs to hammer out one point.

So who are these labels that are upset?

Sounds more like an offhanded comment that one exec made that was exaggerated to me...

"That includes a quick way for users to purchase a song they're listening to, and a slice of the ad revenue that Apple earns. Apple has told the music labels that it plans to build out its iAd business, including the potential of adding audio ads such as those heard on Pandora's free service."

+1 for Google - no audio ads...

 

[OllyW]

Do you know anything about Apple at all?

Yes, I know Apple like making money and that they are not going to give away something they have to pay for. iAd audio advertisements are mentioned in the CNET article linked in the first post.


I also read most of the rumours posted here.

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.

https://www.macrumors.com/2013/05/0...g-with-sony-and-warner-over-iradio-royalties/

 

[gnasher729]

About as well as Lisa is working for Apple. What did you expect?

As usual, lilo tries his hardest to put a negative spin on Apple.

Sony had some really good technology, but the media part of the company killed it. Just like they killed later Sony music players by their stupid insistence on DRM in the player to protect their music business. Sony could have been the company selling 300 million music players instead of Apple. They blew it. That's what Minidisc was: An opportunity to open up a multi billion dollar market, which Apple then _did_ open up, and Sony blew it. On top of that, the multi-billion dollar music player market then opened the multi-ten billion dollar smartphone market to Apple, and the multi-ten billion dollar tablet market (both iPhone and iPad are an evolution of the iPod Touch), both markets in which Sony is basically absent.

Lisa, on the other hand, wasn't that great a success itself, but it did actually make money. And it did create the foundation for the really successful product, the Macintosh. Which has been growing and growing and growing for the last 29 years, to the point where it now makes 45% of all profits in the computer market. And that is all based on the development of the Lisa.

 

[ThunderSkunk]

This whole thing is stupid and Apple should stay out of it unless their service will have some really clear advantage, & not waste time & money on anther half-baked "me too" service like Ping or Maps (yeah yeah I know why).

I wish Apple would think bigger. Music, Film, Web content... What will it look like 50 years from now? It doesn't take a genius to see what logical way that's going, so how-about develop that instead, or ffs, we'll never get there. These ancient, crappy, content companies & distribution model need competition. Work on that.

 

[charlituna]

The problem is that this would destroy the iTunes download business. Would those $15 fees make up for that? I doubt it.

So does iTunes Match. $25 a year and I can have 25k songs I torrented and ripped matched up etc. no requirement that even one of them was purchased from iTunes

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Apple (irresistible force) vs. Sony (immovable object).

http://youtu.be/9eKc5kgPVrA

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Since when has stalled negotiations with only one media company stopped Apple from announcing or launching a service?

Since when does a pack of rumors posted without the word 'allegedly' in every sentence as it should be, make something fact.

Truth is that we don't know that Apple is working on anything, if they are then the nature of it, what labels they have talked to or that was said in those talks. As real fact not rumor.

This would not be the first time that the sources were certain of something that didn't happen. Remember those case makers that had sources telling them that the iPhone 5 was coming the year after the iPhone 4. Complete design redo etc. and what did we get? A spec bump in the same form as the iPhone 4.

 

[c-Row]

When I'm up for listening to music, I prefer random music of a particular Genre. I don't want to know who the next artist / song is going to be. You may like Spotify but many other people prefer a Pandora (what you call passive / radio). I don't criticize the way you listen to music so don't criticize the way others listen to music. There are plenty of music services around and you should use the one that meets your needs (doesn't need to be Apple).

You know that Spotify has a radio option as well, don't you?

 

[toaster64]

The problem is that this would destroy the iTunes download business. Would those $15 fees make up for that? I doubt it.

A Pandora-like-format would put a dent in downloads, sure, but it would allow the downloading business to survive in some form alongside iRadio.

The download business would have already been dead because of Spotify if streaming was going to kill it. Some people want to "own" the music, not pay each time to play and stream it over the Internet. You can't even use it in the car without chewing your data, and you have to pay monthly just to keep your old songs.

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What about skipping songs if you've already purchased them on iTunes, and they come up on iRadio?

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So how's that MiniDisc working out for you, Sony?

Intel is way worse when it comes to DRM. Wikipedia on HDCP:

"In order to make a device that plays material protected by HDCP, the manufacturer must obtain a license from Intel subsidiary Digital Content Protection LLC, pay an annual fee, and submit to various conditions."

And after all that, it'll glitch out sometimes and gyp users out of stuff that they bought. My respect for Intel plunged when I found out that they were behind HDCP.

 

[3282868]

It was Warner Bros. not Sony.



As for Mariah Carey, her "meltdown" happened after she left Columbia Records and signed with Virgin. In fact, her meltdown was the reason Virgin bought out her contract (that she had just signed the previous year).

Huh, I could have sworn Prince's battle was with Sony. My bad.

Yup, you're 100% spot on. Don't know why I thought it was Sony, it's been too long (can't believe it's 2013!). Any ways, from what little I gathered from my friend(s) who worked at Sony, they weren't the kindest with their record label. Ya gotta give Mariah Carey credit, that "meltdown" was genius and got her a lot of cash. I remember seeing her appear on a few tv interviews and MTV, interesting that her public appearances increased with her erratic behavior. Smart business woman.

 

[charlituna]

I wish Apple would think bigger. Music, Film, Web content... What will it look like 50 years from now? It doesn't take a genius to see what logical way that's going, so how-about develop that instead, or ffs, we'll never get there. These ancient, crappy, content companies & distribution model need competition. Work on that.

It's easy to think that Apple should get into everything but in reality it's a rather foolish thought. Particularly in regards to media. The big studios etc are making what folks want and it doesn't matter if Apple pulls a Netflix/Amazon and starts producing shows when Warners etc will still blanketly encourage torrents with insanely high prices, vastly delayed release dates, crap like box sets with no way for those that bought the season to buy up and so on. And all the Apple shows and movies in the world won't give them the copyrights to change that nonsense. And unless Apple can find a legal hole to put an end to exclusive deals then he studios will simply say no to Apples setting rules and go to whomever will let them keep things playing by studio rules

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Apples version will be free. That is why it will instantly become the largest streaming service the day it launches.

It will likely be a much improved version of pandora and be free.

You don't know that it will be at no money from users and if it is but has ads hen it isn't really 'free' in many folks eyes

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I hope these music execs don't expect users to pay for listening to music.

1. There's already plenty of free radio stations listed in iTunes itself.

Nope there's not. Not anymore. Not for iOS (ever) and not in iTunes as of version 11 if not 10

2. We can watch movies and TV shows for only 7.99$CAD per month via Netflix.

It's hardly all shows and movies or even all seasons in some cases. And there are conditions on that fee like only one stream can play at a time

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I wonder if it would be possible for artists to sell their music directly to consumers via iTunes.

Yes, has been for years.

 

[samcraig]

You don't know that it will be at no money from users and if it is but has ads hen it isn't really 'free' in many folks eyes

No - he doesn't. But he sure likes to pretend he's an expert on, well, everything.

I imagine that people will have less of a problem Apple serving up ads because it's not the main way they make money (as opposed to Google). To me - it's all the same no matter what company does it. And if it's free but ad supported - that's one model. It's no secret that Apple has floundered in the advertising industry with iAds. iRadio (or whatever it will be called) could at least give them a revenue stream they were originally hoping for - assuming the product is worthwhile and adopted.

We shall see.

 

[SatManager]

The publishers and content holders have fragmented the market so that you can't purchase your song, tv show, or movie in the media (cd, dvd, bdrom, download, stream), or stream provider (netflix, hulu, apple, HBO, showtime, etc) without subscribing to multiple providers or buying multiple copies. And they wonder why users pirate content.

This is just another example, if true, of wanting something for nothing. Sony expects Apple to pay for someone who doesn't listen to a song. As many have said, Apple should just say - "Thank you, have a nice day. Come see us when you ready." And release it with the other labels. Call their bluff and see who has the egg on the face at the end of the day. Particularly if you run an ad letting the listener know that is why they can't hear a Sony artist.

We don't know what the feature set is going to look like on iRadio, anything we guess is just that - GUESSES!

 

[Yvan256]

1. There's already plenty of free radio stations listed in iTunes itself.

Nope there's not. Not anymore. Not for iOS (ever) and not in iTunes as of version 11 if not 10

Music -> Radio.

It's still there, they just changed where it's located in the menus.

 

[samcraig]

The publishers and content holders have fragmented the market so that you can't purchase your song, tv show, or movie in the media (cd, dvd, bdrom, download, stream), or stream provider (netflix, hulu, apple, HBO, showtime, etc) without subscribing to multiple providers or buying multiple copies. And they wonder why users pirate content.

This is just another example, if true, of wanting something for nothing. Sony expects Apple to pay for someone who doesn't listen to a song. As many have said, Apple should just say - "Thank you, have a nice day. Come see us when you ready." And release it with the other labels. Call their bluff and see who has the egg on the face at the end of the day. Particularly if you run an ad letting the listener know that is why they can't hear a Sony artist.

We don't know what the feature set is going to look like on iRadio, anything we guess is just that - GUESSES!

You're suggesting that Apple runs an ad that criticizes Sony as a means of leverage? Probably a good thing you're not CEO then.

 

[blasto2236]

Can someone explain the rationale for making the radio provider pay for skipped songs?

It's the radio provider's bandwidth that gets used, and the song isn't listened to. It sounds like the most ridiculous concept ever.

And how does Spotify get around it? Can I cost Spotify big bucks by sitting there skipping songs all day on their radio?

Spotify Radio stops you eventually, too. Even if you pay for the premium service. The labels seem to have negotiated themselves a pretty sweet deal there.

Personally, I have very little interest in any radio service. The whole reason that Spotify is enticing to me is because I can listen to what I like and filter out the crap. I can't tell you how often I see friends post on Facebook, etc about how "X" radio service continues to play artists that they have repeatedly given the "Thumbs Down" to. Worthless.

For my money, Spotify Premium is worth every penny just for on-demand priveleges, and it will be hard for Apple to take my business away unless their service is comparable. Currently I'd rather just pay the 25/year for iTunes Match to fill in the few gaps in Spotify's library.

 

[leo.andres.21]

Since when has stalled negotiations with only one media company stopped Apple from announcing or launching a service?

Since Sony label owns a whole lot of popular music, along with Warner and Universal, the three major labels that would bring a lot of users, do or die I am sure Apple desperately want Sony as much as Sony need Apple, same story as before with the iTunes store, we just don't have Steve Jobs to convince Sony this time around

 

[apolloa]

Oh, like 'The Net'? The underlying preposition of that movie was that all computer systems, no matter what OS they used, could be accessed from the same software; no matter what... It was 'a little ahead of its time' in thinking that, but...

Nope, I was thinking more along the lines of the current 'reality' of life, you know the one where every website you visit, every email you send, every track you download, every purchase you make, every SMS you send etc is all recorded in some way or another, one for businesses and their uses and two for governments.

As for the rest of your post, Sony aren't doing ANYTHING wrong, not ONE THING. What you think just because it's Apple EVERY corporation no matter what should roll on their backs and give in to every demand Apple makes? Or do you think they have every right to actually conduct business and demand the same rules for everyone they deal with?

It just hurts you because you somehow believe, like everyone else here, that Sony is some kind of bully purely because it refuses to let Apple have more for less. No one is allowed to be a corporation and conduct business when it comes to Apple because Apple have every right the get what they want regardless of what the other party wants, right?

 

[Nickerbocker]

The problem is that this would destroy the iTunes download business. Would those $15 fees make up for that? I doubt it.

A Pandora-like-format would put a dent in downloads, sure, but it would allow the downloading business to survive in some form alongside iRadio.

It may be profitable if marketed right. There are a lot of people, like me, who probably only buy 6-8 albums a year. If Apple can hook me into a subscription service them and the recording industry would be making more money off of me. As it is now I just buy my music off of iTunes, Amazon, or Google Play because they all work with iTunes Match and I like that more than Spotify et al. Its more "mine".

 

[apolloa]

That's the kind of person who would know everything about innovation. For heaven's sake, he is a banker, which means he has no brain, no conscience, no nothing except an exaggerated sense of self-importance and self-entitlement.

Well the poll was responded to by financial experts, not people on the internet, and the writing is on the wall anyway seeing as the article states, what is already known, that Apple's stock price has dropped 40% since it's high last year!

Here's another piece from the story:

Apple fared worse among non-U.S. investors, with 74 per cent of European respondents and 83 per cent of those in Asia saying Apple has lost its cachet as an innovator. In the U.S., 63 per cent agreed the company has either permanently or temporarily lost its way.

Of course Gnasher if your such an amazing financial investment banking expert, perhaps you should enlighten us all if you have millions held up in Apple stock? But if you want to state you know better then these people then go ahead.

 

[apolloa]

First, Spotify pays a different rate than say Pandora. Pandora's rate is lower because it doesn't let people play the exact song they want at the time they want it. Further, Pandora pays the artists more than Spotify.

Since, unlike Spoitfy, Pandora is a radio streaming service the issue of does it let people skip songs arises. If so, does Pandora have to pay for a skipped song is an issue. Pandora's deal allows users to skip a certain amount of songs a month without paying. This is what is at issue. Apple is trying to add a feature, perhaps an innovative one, that lets people fast forward, rewind, or skip. Unlike Universal, Sony is standing in the way. Moreover, services like Pandora are geared toward helping people discover new music to buy, which in turn makes labels more money than Spotify does. People would have to listen to a single song over a hundred times for the labels to make what they do from one iTunes purchase. Apple also has the right to try and strike a deal different than Pandora, which is already being raped, if it thinks it can add value. History has shown Sony is its own worst enemy.

Second, do you mean the same institution investors that were disappointed by Apple's record breaking 5 million iPhones in 3 days to actual people, but excited by Samsung's 10 million sales to the retail channel in 28 days? Or how about the analyst who recently valued Apple at 270 dollars a share based on estimated 2012 earnings that were 70 billion off the mark (even though the earnings were already released). Apple is the most manipulated stock on the market. I would ignore them. As Warren Buffet says those so called investors are giving Apple a great opportunity to buy its stock back at discounted prices, and Apple has allocated 50 billion to do just that.

Sony aren't standing in the way? Sony are gosh horror performing like a corporation, fancy that eh? How dare they! As for the article it only quotes a couple of the respondents, why don't you read the article and find out for yourself? But it states they are financial experts as opposed to people on an internet forum.

This is so funny, this is only business, the same sort of business that happens everyday and yet somehow everyone is upset with that? The fact Sony is right to stick it out for as much as it can get and make Apple pay the same as everyone else it does business with. And if Apple offered me half as much for more control I would do the same, in fact I'd laugh them out the room most likely.

 

[furqan8421]

What labels are exactly upset? Only one is actually signed. One is "close" to signing - but I don't see how they can get upset that someone hasn't signed yet. Especially since Sony is technically "close" to signing but needs to hammer out one point.

So who are these labels that are upset?

Sounds more like an offhanded comment that one exec made that was exaggerated to me...

"That includes a quick way for users to purchase a song they're listening to, and a slice of the ad revenue that Apple earns. Apple has told the music labels that it plans to build out its iAd business, including the potential of adding audio ads such as those heard on Pandora's free service."

+1 for Google - no audio ads...

Sometimes its just PR speak to add pressure to get a deal done