Ever since Apple announced that it would offer a streaming music service, there has not been much doubt that Apple would attempt to beat Internet radio heavyweight, Pandora. The thinking is that Apple will squeeze music labels to get better terms than Pandora. Such a scenario is certainly better for Apple, but what has not been clear is how Apple would make its service superior to Pandora’s for users.
In contrast to that prevailing wisdom, CNET is reporting that Apple may now be offering a sweeter deal to the music labels than Pandora. CNET is also reporting that Appleis close to signing deals with Universal Music and Warner Music, citing “two people familiar with the negotiations.”
If true, this will bode well for a launch of iRadio this summer. The key question remains how Apple can offer a better deal than Pandora to music labels and still be competitive. The answer lies in additional revenue streams.
If the CNET report is true, Apple iRadio plans are becoming clearer. Apple may present an iRadio listener a download button for a song as the user listens to it. Such a button may lead to a large number of impulsive sales. This feature may also give Apple an edge over Pandora with consumers.
Pandora is a well-designed service but Apple could make iRadio much easier for users of Apple devices. In addition to song downloads, Apple may offer unique features such as a facility to restart a song.
As of this writing, Apple stock was hovering near its 52-week low of $419. Launch of iRadio would be welcome news for long suffering Apple shareholders. This will signal that Apple is getting closer to generating more revenues from its user base. After iRadio, a more significant way to generate more revenues from several hundred million credit card records in Apple’s data base will be iWallet.…Read more at Forbes
