Apple in Talks to Buy Stake in U.S. Radio Group iHeartMedia

[MacRumors]

Apple has held talks with iHeartMedia to buy a stake in the U.S. radio company, according to a new Financial Times report citing people familiar with the matter.

iHeartMedia is currently $20 billion in debt, with audiences gradually turning away from radio in favor of digital music services like Spotify, Apple Music, and Pandora. The radio group filed for bankruptcy in March, and has been in contact with several potential investors ahead of a deadline later this month to file a reorganization plan with the bankruptcy court.

iHeartMedia is hoping Apple will take an equity stake worth millions of dollars, according to FT sources, although discussions between the two companies are still in the early stages and no deal has been agreed. Apple declined to comment, while iHeartMedia did not respond to multiple requests for comment.

The report suggests Apple is angling for a deal in order to gain a platform for wider distribution of its Beats 1 radio station and increase awareness of Apple Music:

A partnership could see Apple Music's Beats 1 radio station, which is only available through its apps, make its debut on broadcast radio. Extra distribution would give Beats 1 and Apple Music greater awareness among older audiences who are later adopters of streaming services. A deal would also put the Apple station into more cars or kitchens.

Despite being billions of dollars in debt, iHeartMedia remains the largest radio broadcaster in the United States, with more than 850 stations operating across the country. One music industry executive who spoke to FT described the potential deal as a "power move" by Apple, as it aims to persuade more artists and labels to strike exclusive or early releases for its streaming service instead of its biggest rival, Spotify.

Apple Music surpassed 50 million subscribers and free trial users earlier this year, giving it a bigger share of listeners in the U.S. than Spotify, although Spotify is still the global leader with more than 80 million paying users around the world. Earlier this year, Apple acquired music recognition app Shazam for $400 million in order to improve Apple Music's listening recommendations.

Article Link: Apple in Talks to Buy Stake in U.S. Radio Group iHeartMedia

 

[JRobinsonJr]

Although statistically it may be true that listeners are turning away from traditional radio, there are still a lot of users who love radio. Like me! I leverage iHeartRadio to listen to multiple channels that I simply cannot get elsewhere.

My concern is that these streaming radio services (e.g. iHeartRadio) will be either shut down or pulled into the subscription model. They can't technically charge for rebroadcasting a station... but they sure could charge for the "convenience".

 

[Rogifan]

Ugh iHeart stations are the worst, just top 40 crap. In my market they took a really great station that played adult alternative (AAA) format and turned it into a top 40 (CHR) format, a clone of another station they owned in the market. Now they’re morphing it into Hot AC. The only stations in my market that play decent music are public radio stations.

 

[robvas]

I really like their Mac app. Simple and free and no commercials

 

[AngerDanger]

I wonder if there was a brief moment of panic when Apple first made contact that they were taking legal action against the iHeart branding.

 

[Naraxus]

A partnership could see Apple Music's Beats 1 radio station, which is only available through its apps....

Pretty much the only way they'd get people to actually listen to Beats 1....

 

[magicschoolbus]

iHeart is a lost cause. No way.

 

[ipedro]

I love the concept of Beats 1 and that Apple is investing into the platform. MCs and curated music are not dead. Sometimes you just want the company of another voice and to have music played for you without much thought.

But, Beats 1 is far too US and UK centric. That means way too much hip hop/rap/trap and grime. Apple needs to break off into local stations for major cities with Beats 1 then playing the best of each station that might appeal to a global audience. I’d love a Beats Toronto, Beats Tokyo, Beats Rio, Beats Johannesburg...

 

[Kabeyun]

...with audiences gradually turning away from radio in favor of digital music services like Spotify and Pandora.

And, um, Apple Music. Right, MACrumors?

 

[bruinsrme]

Wait! $20 billion in debt?
That had to be a typo

 

[Stig McNasty]

…

But, Beats 1 is far too US and UK centric. That means way too much hip hop/rap/trap and grime…

It's more a case of Beats 1 being Urban Yoof. In the UK, Hip Hop, Grime etc has a very limited audience, but a disproportionate media interest. Not one of the major radio stations except BBC Radio 1 Xtra gives more than a nod to these genres - and Xtra has a 0.4% UK audience share!

There is far far more going on with the UK's ever evolving music scene than a few ex-pat DJs may make it look.

Ps. Please, please, keep Charlie Sloth. Who errm left the BBC earlier than planned due to his award show shenanigans (Google it).

 

[Futurix]

Wait! $20 billion in debt?
That had to be a typo

That's how they got some many radio stations in the first place - financed their takeovers by borrowing money. Lots and lots of money.

 

[gsmornot]

I love the concept of Beats 1 and that Apple is investing into the platform. MCs and curated music are not dead. Sometimes you just want the company of another voice and to have music played for you without much thought.

But, Beats 1 is far too US and UK centric. That means way too much hip hop/rap/trap and grime. Apple needs to break off into local stations for major cities with Beats 1 then playing the best of each station that might appeal to a global audience. I’d love a Beats Toronto, Beats Tokyo, Beats Rio, Beats Johannesburg...

Wow. Until you said Beats 1 I forgot it was an option on my Apple Music. I have not listened in quite a while now I guess. I spend my time on Top Charts when I want a radio like experience.

 

[rednip]

Iheartmedia is well known for its right wing leanings. I would seriously reconsider my Apple Music subscription if they were to bail out that cesspool of reactionary lunacy.

 

[maflynn]

I thought I read somewhere that iheartmedia was bogged down in debt and/or poor performance.

 

[H3LL5P4WN]

I hope Apple buys them and then shuts them down.

 

[VARTV]

Wait! $20 billion in debt?
That had to be a typo

Previous bad business decisions/acquisitions for iHM...

 

[iReality85]

Although statistically it may be true that listeners are turning away from traditional radio, there are still a lot of users who love radio. Like me! I leverage iHeartRadio to listen to multiple channels that I simply cannot get elsewhere.

My concern is that these streaming radio services (e.g. iHeartRadio) will be either shut down or pulled into the subscription model. They can't technically charge for rebroadcasting a station... but they sure could charge for the "convenience".

Before I bought a retro radio earlier this year, I used my iPad mini 2 everyday here in the office and streamed iHeart Radio. It was really great, except when my office WiFi started to get wonky. I needed something more reliable.

I think it's a good move by Apple. I know a lot of younger people poo-poo "regular" radio, but many millions and millions still listen to AM and FM everyday.

Ugh iHeart stations are the worst, just top 40 crap. In my market they took a really great station that played adult alternative (AAA) format and turned it into a top 40 (CHR) format, a clone of another station they owned in the market. Now they’re morphing it into Hot AC. The only stations in my market that play decent music are public radio stations.

Iheartmedia is well known for its right wing leanings. I would seriously reconsider my Apple Music subscription if they were to bail out that cesspool of reactionary lunacy.

Just an FYI, iHeartMedia used to be Clear Channel Communications, and because of that they own the majority of local AM radio affiliates around the country (and a decent chuck of FM stations). Lots of AM stations now have corresponding FM counterparts too... I always listen to my local AM station now on FM since it comes in clearer.

So I guess it's a YMMV sort of thing. Some of the FM stations where I live are owned by iHeartMedia, and those that are haven't really changed all that much. There's a lot more cross-advertising among them now, though.

No comment on the "right wing" leanings.

 

[jlc1978]

Having grown up listening to AM and later FM radio I find myself only listening to NPR (and even stream KQED more than I listen to my local NPR station) since most of the stations that play "classic" rock play the same playlist over and over with more commercials than music. For music it's Pandora or my own collection.

So that brings me to this question:
Does iHeartRadio have any personalities or shows that have a large audience? If so, Apple's move could be a step to brining them to Apple Music in a bid to gain subscribers, much as Sirius did with Howard Stern.

 

[scottrngr]

Having grown up listening to AM and later FM radio I find myself only listening to NPR (and even stream KQED more than I listen to my local NPR station) since most of the stations that play "classic" rock play the same playlist over and over with more commercials than music. For music it's Pandora or my own collection.

So that brings me to this question:
Does iHeartRadio have any personalities or shows that have a large audience? If so, Apple's move could be a step to brining them to Apple Music in a bid to gain subscribers, much as Sirius did with Howard Stern.

Yes. Ryan Seacrest. So if you love Ryan Seacrest you can hear him on every station and every format, after you are done watching Ryan and Kelly.

 

[wigby]

Iheartmedia is well known for its right wing leanings. I would seriously reconsider my Apple Music subscription if they were to bail out that cesspool of reactionary lunacy.

Or maybe you should seriously consider listening to iheartmedia stations since Apple would be infusing their own brand and ideals into it as a big investor. All opinions (political and otherwise) are up for sale to the highest bidder.
[doublepost=1541077779][/doublepost]"Extra distribution would give Beats 1 and Apple Music greater awareness among older audiences who are later adopters of streaming services."

If you've ever listened to Beats 1, the one thing you can count on is that their demographic is anything but an older audience. Apple needs to break out Beats 1 into many genres if they want to attract demographics other than 15-18 year old urban youth.

 

[davpel24]

If this is what it takes for the iHeartRadio app to add Siri Shortcuts support, then fine. I have a local sports talk radio station that I listen to every morning and I would love to be able to initiate play from my HomePod rather than have to open the app and do it manually.

 

[cmaier]

Unless it’s to make all the content a free part of Apple Music, I don’t get it.

 

[brian3uk]

I don't understand this plan. Apple shouldn't bail them out. Broadcasting Beats 1 isn't worth it. iHeart should stop their big award show and cut down on stations if they need money. Even if Apple does help they will be back in debt in a few years anyway.

 

[scooterv51]

Or maybe you should seriously consider listening to iheartmedia stations since Apple would be infusing their own brand and ideals into it as a big investor. All opinions (political and otherwise) are up for sale to the highest bidder.
[doublepost=1541077779][/doublepost]"Extra distribution would give Beats 1 and Apple Music greater awareness among older audiences who are later adopters of streaming services."

If you've ever listened to Beats 1, the one thing you can count on is that their demographic is anything but an older audience. Apple needs to break out Beats 1 into many genres if they want to attract demographics other than 15-18 year old urban youth.

I agree. That is why I also subscribe to SiriusXM. It has variety, maybe too much.