How can iTunes Radio break even?

Discussion in 'Apple Music, Apple Pay, iCloud, Apple Services' started by Silvereel, Sep 22, 2013.

  1. Silvereel macrumors 6502

    Jan 19, 2010
    Maybe it's just me, but I'm hearing next to no ads on iTunes Radio. What I do hear is usually either for iTunes Festival or something on iTunes. I've probably heard about 5 actual ads, all for Macy's.

    Don't get me wrong, I'll take this over Pandora any day. But if Apple's licensing agreement is anything like theirs, I don't understand how they can keep from losing a lot of money on this...
  2. GenesisST macrumors 68000


    Jan 23, 2006
    Where I live
    Do you have iTunes Match? If so, then you have no ads and therefore your 25$ per year goes into the pool.

    If not, then I'm pretty sure that will be fix before long. :)
  3. Altis macrumors 68030

    Sep 10, 2013
    Could be that they want to hook users to it first, then once they've crushed the competition, start introducing more ads.

    It's likely that their contracts have a warm-up period, kind of like getting 6 months of free service in a multi-year plan.
  4. Jessica Lares macrumors G3

    Jessica Lares

    Oct 31, 2009
    Near Dallas, Texas, USA
    Pandora will mix you in with car insurance, Rosetta Stone, and all that other junk. Apple probably made a deal where they wouldn't do that if the advertisers agreed to pay more, thus giving the ads a better chance to get noticed by listeners.
  5. Alrescha macrumors 68020

    Jan 1, 2008
    I'm pretty sure that Apple doesn't intend on losing money with iTunes Radio, but unlike Pandora they probably don't care about making a lot either. iTunes Radio is very likely just another enhancement to the Apple ecosystem - like the iTunes store* - which exists to keep customers happy (and buying more Apple gear).


    * until about 2012, the iTunes store ran just a bit over break-even, according to Tim Cook.
  6. SluGuru macrumors regular

    Aug 28, 2013
    Do not forget that you can buy songs directly inside of iTunes Radio. With as deep of information they have gathered over the years with Genius I would expect to see a big bump in the sales of singles because of the service.
  7. boltjames macrumors 601


    May 2, 2010
    Apple isn't doing iTunes Radio to make money. It's a defensive move to cut Pandora off at the knees before it seriously impacts the iTunes Music Store, and it's the Music Store that's the cash cow at Apple.

    And if there's a secondary reason for iTunes Radio it's because it's a great way to expose more people to more music and thus sell more music at the iTunes Music Store.

    And if there's a third reason for iTunes Radio it's because Apple is trying to be the Android of the Automobile industry (iOS In The Car) and having a streaming radio service to take on Sirius XM is a nice deal-sealer.

  8. Jazwire macrumors 6502a


    Jun 20, 2009
    This, and the fact that Apple has a mountain of cash, they aren't worried about making a profit on iRadio in the short term.

    The goal realistically is to kill Pandora, once that is accomplished things will change. But until then enjoy.... :)
  9. DipDog3 macrumors 65816


    Sep 20, 2002
    My experience is the complete opposite. I am hearing ads after almost every song. It is quite annoying.
  10. tonyr6 macrumors 65816


    Oct 13, 2011
    Brooklyn NY
    Also the ads are starting to get more annoying like FM radio. I know I can pay for iTunes Match but then it erases all of my music off my iPod Touch if I turn it on. If it is off you still get ads which is why I cancelled iTunes Match after only a hour.

    Back to Slacker Radio Plus which also includes AOL Radio Plus. Surprised that no one mentions this. It is either Pandora this, Spotify that and Pandora this again.

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