Record labels reportedly unhappy with Apple’s radio service proposal

By , Oct 26, 2012

By now, you’ve probably heard the rumors that Apple is working on a Pandora-like internet radio service. Yesterday, Bloomberg added to the speculation, saying that a deal with record labels could be reached by mid-November.

But according to a follow-up report, that may not be the case. Apparently, some record executives haven’t been particularly impressed with the revenue sharing proposal. And they want Apple to sweeten the deal before they sign…

CNET (via Cult of Mac):

Bloomberg reported this afternoon that Apple’s negotiations with the three top labels have “intensified” over an ad-support Web radio service that Apple hopes to launch early next year. But music industry executives who spoke with CNET said that some decision makers at the big record companies want Apple to sweeten the offer.

The negotiations are ongoing so the terms could change, but the sources said Apple has offered to pay a lower royalty rate than Pandora pays even though it wants to provide iTunes users with the ability to do more with the music than Pandora’s customers enjoy.

In exchange for this greater flexibility with songs, Apple is offering a percentage of the ad sales generated by the service. CNET’s sources say that some of the sector’s leaders don’t believe the cut Apple put on the table is big enough. Others in the music industry, however, argue it’s good for the overall business if Apple takes on Pandora.”

It’s not surprising that record companies are pushing back on Apple executives in negotiations. We heard similar talk last summer as the Cupertino company hashed out iCloud and iTunes Match deals with the four major labels.

Back in early September, The Wall Street Journal reported that Apple was working on an iAd-supported streaming music service that would take on the likes of Pandora and Spotify. We’ve since heard several corroborating reports.

So it sounds like this thing is really going to happen; it’s just a matter of when at this point.

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  • queen_ir3ne

    Lol, Apple being cheap once again. It never fails.

    • http://twitter.com/jmarsh5 Justin Marshall

      Considering the amount of money these internet radio providers lose I don’t think it is necesarily Apple being cheap so much as covering their own backs. iTunes offers so much more than Pandora does, feature and ecosystem-wise. For example, if you hear a song on Pandora, you can’t go out and buy directly from Pandora. With iTunes, you can do this.

      • Denniz Vi

        uh yes u can… I can get unlimited songs from pandora downloaded and converted to work with itunes along with youtube songs and videos to my itunes on my 4s, sometimes we the people gotta b cheap too…

      • http://twitter.com/jmarsh5 Justin Marshall

        But you can’t BUY them directly from Pandora resulting in profit on Pandora’s end and then ultimately the record labels end.

    • Obsidian71

      More like the content companies playing “pimp” again.

  • http://twitter.com/khoobler Kyle Hoobler

    APPLE STOP! You do NOT have to do everything! Stick with hardware! Invest more on hardware and software development!

    • Obsidian71

      Apple: “no”

      • MagicDrumSticks

        Apple: now bend over obsidian, and this time I’m going raw, no lube.

        Obsidian: ^_^ anything for you. OHHHHHHH.

      • Obsidian71

        LOL. That was hilarious and demented at the same time.

      • MagicDrumSticks

        Lol

      • http://twitter.com/CasperEvis CasperEvis

        Alfred answered I’m amazed that a single mom can profit $9556 in 4 weeks on the network. have you seen this (Click on menu Home)

      • http://twitter.com/CasperEvis CasperEvis

        …..goo.gl/15qt0

    • Tr1pTr0p

      Lol wut? You seriously think Apple is doing this for your convenience and well being because they are so kind? Wake the fuck up, please? They’re doing it for the money, you sheep, just like every other corporation.
      O_o