Apple, Sony unable to come to terms; iRadio is delayed

Apple, Sony unable to come to terms; iRadio is delayed
According to a published report on Thursday, Apple's inability to come to terms on a licensing deal with Sony Music has led to a delay in the launch of the Apple iRadio streaming music service. Rumors of such a service started picking up speed earlier this year when hidden icons were found on an Apple iPad running iOS 6.1. Apple and Universal Music are rumored to have worked out an agreement while a deal with Warner Music is said to be close. 

This isn't the first time that an impasse between Apple and Sony has been rumored. Earlier this year, talks between the two firms were going nowhere preventing Apple from launching its service around the Grammy Awards which were held in February. Part of the problem is that Apple had originally offered the labels 6.5 cents for each 100 songs streamed which is half the rate that Pandora pays. The labels rejected this offer and Apple subsequently raised its offer to 12.5 cents for each 100 songs streamed. It is not known how many labels agreed to that rate. The problem for Apple is that the record labels see the iRadio service as being a big hit for the Cupertino based tech giant, and feel that they should be sharing in the rewards.

For its part, Apple is said to be offering the labels a combination of a licensing fee based on the number of streamed tracks and a share of advertising revenue. Apple is also proposing a guaranteed monthly payment to the labels in case iRadio doesn't do as well as predicted. The service is expected to be offered free with Apple making money from advertising.

source: FinancialTimes via AppleInsider



1. HASHTAG unregistered

Okay, Apple is really greedy!

11. quakan

Posts: 1419; Member since: Mar 02, 2011

I don't see how Apple is greedy in this situation. Apple low-balled with a ridiculous amount so that they could offer Sony the price they really wanted to pay which was right below what Pandora pays. Apple, being a big force in the industry, probably felt that since they have more market power and more access to consumers that should pay a rate less than its competitors. I'd be surprised if Apple still wouldn't be able to get a rate less than Pandora's.

12. vincelongman

Posts: 5745; Member since: Feb 10, 2013

I hate how iCloud only backs up music, movies, books,... from iTunes, its just to try force people to buy only from iTunes. Also I wish you could stream from iCloud as well.

13. quakan

Posts: 1419; Member since: Mar 02, 2011

Nothing wrong with that, honestly. Apple's a for-profit company so it only makes sense that they would aim for high profits. Also, Apple only allows you back up those items to their iCloud because they are strictly anti-piracy which content creators love.

16. vincelongman

Posts: 5745; Member since: Feb 10, 2013

In my opinion their iCloud policy is very similar to DRM, and it barely helps stop piracy. At first music from iTunes had DRM, then Jobs managed to get the music companies to allow iTunes to sell music without DRM, I don't have numbers, but I reckon the removing of DRM increased sales and reduced piracy.


Posts: 456; Member since: Nov 19, 2011

hahahah apple just lost 1.5 cents per 100 for being such freaking tools

3. roscuthiii

Posts: 2383; Member since: Jul 18, 2010

If they were willing to go from 6.5c to 12.5c then they haven't reached the breaking point yet. Go for 15.75!

4. roscuthiii

Posts: 2383; Member since: Jul 18, 2010

With Apple's brand recognition, they'd be signing their own death certificates with these deals. Wouldn't really make sense for any customers not to integrate into the lower-case "i" ecosystem for music. But that seems to sum up most business anymore, no one can see past the short term profits to the doom looming just a bit further afield.

14. ardent1

Posts: 2000; Member since: Apr 16, 2011

Now that is a dumb comment. The iTunes solution worked well for the music industry that was being killed by illegal downloads. The fact remains we don't know the "facts" but the 6.5 cents number makes a hell of good sense due to the sheer size of the Apple ecosystem. Sony is going to get the benefits due to economies of scope. The Pandora ecosystem is tiny compared to what Apple can bring to the table.

17. Aeires unregistered

Pandora is on Android and WP, the scope difference isn't what you think it is.

19. ardent1

Posts: 2000; Member since: Apr 16, 2011

Aeires: You need to look at "throughput." For example, android OS dominates the smartphone on a global scale. But if you look at the "throughput" of people buying on the internet in the US with smartphones and tablets, Apple wins hands down. It's not even close. It's throughput, not footprint or eyeballs. Customers on the iOS ecosystem have far more disposable income, ON AVERAGE, than those on Android OS.

20. Aeires unregistered

Ardent1: You need to stop looking at Android users as cheap, broke people. And while you're at it, you might want to start considering the global market and not just basing your opinions on what happens only in the US.

5. Mxyzptlk unregistered

Wow why can't Sony stop being so stubborn? This is a good service.

9. tedkord

Posts: 17452; Member since: Jun 17, 2009

It doesn't exist yet. How do you know it's a good service?

15. ardent1

Posts: 2000; Member since: Apr 16, 2011

Answering a question with a question is considered bad form.

21. tedkord

Posts: 17452; Member since: Jun 17, 2009

Who did that?

10. HASHTAG unregistered

How is Sony being stubborn? They're just not letting Apple get their way, like other companies do.

18. SellPhones82

Posts: 569; Member since: Dec 11, 2008

Exactly! I applaud Sony for standing their ground and not giving into Apple like every other company does. So if Apple pays half of what others pay Sony for the same service does that mean Apple will do the same to the non-subsidized price of the iPhone and sell them at half the price? Hell to the NO so why should Sony? I'm sure Sony like profits just as much as Apple though it seems to be a one way street when dealing with them...they want something for nothing then want carriers and customer to pay out the wazoo for it.

6. JaroB

Posts: 112; Member since: Feb 13, 2013


8. InspectorGadget80 unregistered

Com on sony charge apple some more. They own mgm columbia studios no chance their going too let the greedy fruit get all the profits

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