Apple is looking into creating their own streaming music service, according to a report from the Wall Street Journal. Citing “people familiar with the matter” the reports says that the proposed service would be along the lines of existing service Pandora, supported by ads.
Tech website AllThingsD has outlined that Cupertino could very easily enter this market space, saying that Apple could launch a ‘Web radio’ service tomorrow if they felt like it due to existing agreements with record labels. But Apple is likely looking for a more flexible license agreement with labels in order to create a better streaming offering for consumers.
However the AllThingsD report also asks why Apple is looking into an ad-based streaming service, especially since Pandora struggles to show a profit from the same business model. The licensing terms Apple is looking for would be more costly than those Pandora has and, although Apple certainly has the cash to burn, there doesn’t seem to be much profit in the exercise for Apple.
A theory that has been put forward involves boosting Apple’s iAd platform with the aim of turning it into a major enterprise but it is difficult to see how streaming music would accomplish that. The other is that Apple might be hoping to convince users to stick to the iPhone or iPad in the face of similar offerings on rival platforms. Apple usually has the bottom line in mind so it will be interesting to see where this proposed streaming concept goes from here.
Source: AllThingsD