Music publisher blocked iPhone 5 music service, report says
A Pandora-like streaming service could have debuted with last week's iPhone 5 launch if negotiations between Apple and Sony/ATV had not failed, according to a published report. Sony/ATV, which is owned by Sony and the estate of Michael Jackson, wanted Apple to pay a higher fee for each song played than Apple was willing to shell out, according to the New York Post. News broke earlier this month that Apple was considering the idea of creating a streaming-music service similar to that of Pandora, the online-radio service. Typically, a music distributor will just pay the statutory rate that has been set for playing songs on Web radio and will not have to negotiate with individual rights holders. That's what Pandora does. Related stories2009 PC shipments inch into positive territoryMicrosoft brings kids developer tool to the PCApple's Mac shipments up 23.3 percent in the U.S.Reports: Tech recovery driven by developing nations, cloudAT&T to sell Moto Backflip March 7?But Apple wants to do more with the songs than the statutory agreement covers and this required the company to acquire tailor-made licensing, according to the Post's story. If you were wondering how Apple planned to compete with Pandora, the front runner in Web radio, this is how: Apple wants to enable users to play a "selected artist more times" than Pandora is allowed to under the statutory agreement, the Post reported. According to industry sources who spoke with CNET, the music labels are not crazy about Pandora's business model. The service doesn't supply labels with a whole lot of revenue, and managers believe Pandora cannibalizes sales. They have hoped Apple would find a more lucrative way to enter the streaming-music business.That said, the labels are on board with Apple's plan. They realize that Apple is going to do what it wants anyway and that the company has plans to use the streaming service to promote sales. Insiders say Pandora has a Buy Now button that nobody pushes. The music publishers, however, are still miffed about what they consider Apple's attempt to bypass them in initial negotiations over 90-second song samples back in 2010, a story first reported by CNET. Apple co-founder Steve Jobs had been preparing to announce extended song samples at a media event, but the publishers raced in and threatened legal action if Apple didn't negotiate a new fee with them. More important, though, is that music publishers don't like Pandora's model either and don't want to see Apple launch an identical service. If the publishers aren't careful, Apple's leaders could just decide to pay the statutory rate -- the same fees that Pandora pays -- if they can't close a deal with rights holders. Those rates don't leave much room for profit, but Apple could try to wait the publishers out. This would mean the publishers would see less money from Apple than the company is prepared to pay right now. Music sources say the talks continue.Update: 9:40 a.m.:My Colleague John Falcone notes that in iOS 6, the songs in iTunes Match can now be streamed, just like in Amazon Cloud Player, so that you don't need to download it before beginning to listen.
Bandwidth '08 notebook
Bandwidth '08 notebook
The Bandwidth music tech conference in San Francisco attracts folks from all corners of the music industry: from label owners and musicians, to Internet radio broadcasters and mobile phone software developers. This year, the conference featured panel discussions on topics such as the future of music gadgets (a subject dear to my nerd heart), developing music services for mobile phones, and the realities of running a label in today's fractured music industry.One of the more popular themes drawing heated discussion across all panels was the idea of ditching the paid download model dominated by iTunes in favor of giving music away for free. Throughout the day I heard several compelling arguments for and against moving toward a free music download model, but my sense is that economic times will need to get a little tougher before the industry takes a serious look at a free music strategy. That said, with the decline in CD sales drastically outpacing the uptake of MP3 sales, a future of legitimate free music downloads may arrive sooner than you think.As the nation's premier music phone, the iPhone and its App Store garnered plenty of discussion as well, with comments from Tom Conrad from Pandora connecting to an audience eager to leverage the iPhone's popularity and potential. During the same mobile music panel, Cindy Lundin Mesaros from Moderati spoke on the plateaued, yet profitable business of selling ringtones, software, and games for phones.A discussion of emerging trends in consumer electronics was slow to gain momentum, but paid off handsomely with razor-sharp comments from Dave Goldberg, former VP of Yahoo Music, who stated with no uncertainty that MP3 player manufacturers competing with Apple are doing it all wrong (listen to an audio excerpt at the end of this article). CNET's own Kurt Wolff (Download.com Music) also used the panel as an opportunity to tease to Juke.com, a new CNET music Web site in development that has been veiled in secrecy (even to me).One of the last panels of the evening brought together representatives from Rhapsody, Sony/BMG, and TAG Strategic to discuss the state of the music download sales model and its viability going forward. While never reaching a consensus, alternative models such as variable song pricing, flat-rate music subscriptions via ISP, high-fidelity downloads, and bundled incentives (concert tickets, T-shirts, etc.), were all thrown around. The only idea everyone agreed on was the suggestion that artists need to work on building unique, packaged experiences for their fans if they want to increase revenue through music sales (Metallica's Mission Metallica microsite was cited as a prime example).Having just finished my review of the Edirol R-09HR portable recorder, I brought it along to capture a few great comments overheard at Bandwidth:Dave Goldberg on why iPod alternatives fail: Ted Cohen on why the subscription music model is broken: Tom Conrad on the appeal of internet radio:
The Bandwidth music tech conference in San Francisco attracts folks from all corners of the music industry: from label owners and musicians, to Internet radio broadcasters and mobile phone software developers. This year, the conference featured panel discussions on topics such as the future of music gadgets (a subject dear to my nerd heart), developing music services for mobile phones, and the realities of running a label in today's fractured music industry.One of the more popular themes drawing heated discussion across all panels was the idea of ditching the paid download model dominated by iTunes in favor of giving music away for free. Throughout the day I heard several compelling arguments for and against moving toward a free music download model, but my sense is that economic times will need to get a little tougher before the industry takes a serious look at a free music strategy. That said, with the decline in CD sales drastically outpacing the uptake of MP3 sales, a future of legitimate free music downloads may arrive sooner than you think.As the nation's premier music phone, the iPhone and its App Store garnered plenty of discussion as well, with comments from Tom Conrad from Pandora connecting to an audience eager to leverage the iPhone's popularity and potential. During the same mobile music panel, Cindy Lundin Mesaros from Moderati spoke on the plateaued, yet profitable business of selling ringtones, software, and games for phones.A discussion of emerging trends in consumer electronics was slow to gain momentum, but paid off handsomely with razor-sharp comments from Dave Goldberg, former VP of Yahoo Music, who stated with no uncertainty that MP3 player manufacturers competing with Apple are doing it all wrong (listen to an audio excerpt at the end of this article). CNET's own Kurt Wolff (Download.com Music) also used the panel as an opportunity to tease to Juke.com, a new CNET music Web site in development that has been veiled in secrecy (even to me).One of the last panels of the evening brought together representatives from Rhapsody, Sony/BMG, and TAG Strategic to discuss the state of the music download sales model and its viability going forward. While never reaching a consensus, alternative models such as variable song pricing, flat-rate music subscriptions via ISP, high-fidelity downloads, and bundled incentives (concert tickets, T-shirts, etc.), were all thrown around. The only idea everyone agreed on was the suggestion that artists need to work on building unique, packaged experiences for their fans if they want to increase revenue through music sales (Metallica's Mission Metallica microsite was cited as a prime example).Having just finished my review of the Edirol R-09HR portable recorder, I brought it along to capture a few great comments overheard at Bandwidth:Dave Goldberg on why iPod alternatives fail: Ted Cohen on why the subscription music model is broken: Tom Conrad on the appeal of internet radio:
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