Watch out Pandora: You may soon have some serious competition. Reports claim Apple is planning to launch its own Internet radio service early next year. Supposedly, Apple is already in talks with major music labels including Universal Music Group, Warner Music Group, and Sony’s music division to start an ad-supported streaming radio service.
According to people who have knowledge of the negotiations, discussions between Apple and music labels have included ways to share ad revenue. It's possible a deal could be reached by mid-November. If this becomes reality, the service could launch within the first three months of 2013.
If Apple is able to secure licensing pacts with the music labels, it would enable Apple's radio service to be more flexible than Pandora's. Currently, Pandora uses a compulsory license. This license limits how often users can skip tracks as well as how many times an hour an artist can be played. If successful, Apple's direct licenses with the music labels would eliminate these restrictions. Unsurprisingly, Apple is also pushing to try to get earlier access to new releases.
Although Apple currently has more than 400 million iTunes accounts which provides for many music sales, sales of music downloads have been slowing down. Not wanting to lose this revenue stream, Apple is looking for new ways to capitalize on music sales.
If and when Apple launches a radio service, it's likely the company will offer an app tailored for use on its iPhone, iPad, and iPod Touch. People familiar with the negotiations said Apple does not have plans to deliver music through a Web browser at this time.