Rumored summer launch for Apple's own streaming radio service

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Issue Date: 
Apr 5 2013 - 11:50pm

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New reporting from CNet is possibly giving some shape to Apple's much-anticipated streaming music service.

All of these details are sourced from the ever-insightful "people familiar with the negotiations," so none are official. But according to what CNet has heard, Apple is close to settling with Warner Music and Universal Music groups (not yet Sony, nor publishers) for a summer U.S. launch of a non-interactive (like Pandora, not like Spotify) streaming service.

Allegedly Apple will pay royalties less than the statutory rate, and just half what Pandora pays. But to sweeten the deal, Apple will share ad revenue -- possibly as much as 35%-45% -- from a new class of audio ads (not simply the small iAds displays). And Apple is supposedly "proposing to the labels... a full-on, multinational sales force that would sell audio ads akin to what Pandora serves up for listeners to its free service." Apple also hopes to launch the service in the UK, France, Germany, Australia, and Japan (Pandora is legally available only in the U.S., Australia, and New Zealand).

Read more from CNet here.

RAIN ANALYSIS: We'd like to know much more about (a) features that will make Apple's service unique in the marketplace (the CNet article mentions features like "going back to the beginning of the song" and "making it easier to purchase music," which sound mildly interesting, but aren't really anything to hang a service's hat on; and (b) how the music will be "programmed" (i.e. human curation, internal iTunes data, third-party data). An automated, curated radio service based on iTunes data would be something genuinely new in the marketplace, which is currently dominated by only Pandora's Music Genome and services that use The Echo Nest. But would it be noticeably different from a user's perspective? -- MS

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