Digital downloads may have killed the physical media star, but
even the standard MP3 purchase isn't immune to the convenience and
versatility of subscription-based streaming services. With the rise
of Spotify, Rdio, and Beats Music -- which allow users to browse
and stream an almost-limitless song catalog for a monthly fee --
many folks no longer see much use in having a digital copy of an
album just sit on a hard drive somewhere.
And with digital downloads possibly going the way of the compact
) may be planning a streaming rival to Spotify.
that, according to unnamed sources, Apple is mulling an expansion
of its current iTunes Radio service to let users call up any song
hosted by the iTunes Store in exchange for a monthly fee. Like
), Apple's ad-supported service as it exists today only allows
users to choose virtual stations of similar-sounding music without
much control over the playlist. With nearly 30 million songs on the
iTunes servers, the largest of any online vendor, users will have
no shortage of choices.
The plans are still very preliminary with one source from a major
label describing this early process as the "what if stage."
"[Apple is] feeling out some people at labels on thoughts about
transitioning its customers from iTunes proper to a streaming
service," the source told Billboard. "So when you buy a song for
$1.29, and you put it in your library, iTunes might send an e-mail
pointing out that for a total of, say, $8 a month you can access
that song plus all the music in the iTunes store."
Obviously, the folks over at iTunes are keeping mum about such
plans, but there's no time like the present for Apple to consider
launching a Spotify-like service.
A recent report from Nielsen SoundScan shows digital album sales --
where Apple rules over
), and the like -- is down 13% in the US, while sales of digital
tracks are down 11% from last year.
Meanwhile, the Recording Industry Association of America (RIAA) and
the International Federation of the Phonographic Industry (IFPI)
have reported that Spotify and company are enjoying very healthy
subscription, advertising and licensing revenues -- to the tune of
$1.4 billion. The reports confirm that while the streaming business
is booming -- with revenues growing 51% worldwide -- downloads have
slumped a little over 2%.
In a statement
, IFPI CEO Frances Moore painted a rosy picture of the future of
streaming services around the world.
"Revenues in most major markets have returned to growth," Moore
said. "Streaming and subscription services are thriving. Consumers
have a wider choice than ever before between different models and
services. And digital music is moving into a clearly identifiable
new phase as record companies, having licensed services across the
world, now start to tap the enormous potential of emerging
This move, however, doesn't fall in line with earlier plans for
iTunes. Beats Electronic CEO Jimmy Iovine unsuccessfully tried to
convince former Apple CEO Steve Jobs into branching iTunes off into
a streaming subscription service. "I was always trying to push
Steve into subscription. And he wasn't keen on it right away,"
in an interview
. "[Beats co-founder] Luke Wood and I spent about three years
trying to talk him into it."
It's hard to deny where the industry is moving, and if Apple wants
to stay competitive, it should move with it. And that may even
entail throwing a bone to its chiefest opponent.
Sources have also indicated that Apple might design an official
version of iTunes to run on Android. Industry execs have noticed
the massive growth of Android's market share and point to its
numbers as possibly impacting iTunes sales. But with an Android app
and sales available on the top two indomitable mobile platforms,
iTunes can distance itself from the digital download slump.
There's little question about how Steve Jobs would feel about an
Android-compatible service, especially when he was quoted as saying
he didn't "want to make Android users happy."
But sometimes you have to go back on your word in order stay