Monday, June 10, 2013

iRadio: Can you feel the excitement?

Can you hear the world, holding its breath, for the launch of Apple iRadio?

Nope, me neither.

The sheer lack of people who say "you know what I wish? I wish I could stream music through the iTunes interface" has always been noticeable.

It's likely that Apple will make the service a success, simply through plonking the iRadio button on homescreens of devices, and maybe there'll be something to the service unveiled today that makes it essential, or desirable, but it's hard to see the problem with music streaming that needs Apple to solve it.

AllThingsD tries to describe what we can expect:

[It] should function like an enhanced version of Pandora — that is, it will be a free streaming music service that gives users more control of their songs than standard Web radio, but less than full on-demand services like Spotify.
That's... uh, clear. The idea is that the tracks you hear will be half-determined by you telling it what you want to hear, and half it scanning your iTunes history. You know that time you bought the Crazy Frog to burn onto a CD for a joke for your brother? THAT will be the guiding light that iRadio seizes on to build your playlists. That, and the thirty unplayed episodes of OpenSouceSex.

Even so, I'll bet Spotify and Pandora are feeling uncomfortable this morning.

Interestingly, Apple have only just managed to pull Sony on board. Are the majors happy?
The majors publishers had looked like they were going to be the holdout because Apple initially offered to pay them a rate of 4.1% of its advertising revenue, while the publishers had been withdrawing digital rights from the U.S. performance rights organizations BMI and ASCAP because they wanted higher rates. BMG, Sony/ATV, UMPG and Warner/Chappell executives had privately said they were seeking rates of 10%-15% of iRadio’s advertising revenue. But when Apple agreed to a 10% rate, Warner/Chappell last week signed the deal and now so has Sony/ATV.
Getting more than double Apple wanted to pay. That's quite a strong move by the majors. Let's hope they don't do that thing where they suddenly get insanely greedy.
While publishers will get 10% of revenue, they privately are calling this an introductory rate, meaning that after the iRadio service establishes itself, they expect that rate to increase. Likewise, they also say they expect Pandora to match the deals they are doing now with Apple.
"We won't hold our ground when we have the advantage and Apple really needs us for launch. Oh, no. What we'll do, right, is wait until the service is established, and carrying itself along under its own sheer weight of numbers. At that point, when we've got massive sums of cash flowing in from Apple, we'll be in a really strong position to threaten to refuse to take that money any more unless they give us more. At the same time, with Apple crushing Pandora into near-obscurity, that'd be exactly the moment to ask Pandora to give us more of the less money it's making. Genius plan, eh, guys?"


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