Apple is pushing music labels to cut off their free streaming licenses with competitors such as Spotify. The company is aiming to launch its own music service at WWDC in June and wanted to clear the path with anything that gets on the way. If successful, the two companies could become more in line with each other and would also give Apple the chance to increase its customer base.
Apple's move on convincing music labels for its own favor has caught the attention of the Department of Justice (DOJ) which is now looking into the company's negotiation practices. The department has been monitoring Apple's dealings after the company was found guilty of an antitrust case involving ebooks in 2014. Apart from the DOJ, other entities that continue to keep an eye on Apple include the FTC and the European Union's Competition Commission.
"DOJ officials have already interviewed high-ranking music industry executives about Apple's business habits," says the Verge.
As of January, Spotify has 60 million active listeners but only 15 million among them are on a paid subscription. The music streaming service company charges its premium users at $9.99 a month.
Apple's upcoming music service will not have a free streaming feature. Instead, users of the service will be required to pay a monthly charge that could cost anywhere between $7.99 and $10.
Apple has also offered to pay for the music licensing fee of YouTube to Universal Music Group as a way to convince the label to stop allowing its songs to be streamed in YouTube. The latter is currently the biggest free streaming service available on the Internet while the Universal Music Group is tagged as the world's biggest music label.
One source inclined with the music industry commented, "All the way up to Tim Cook, these guys are cutthroat."
Apple is also pursuing other ways to beef up its upcoming new music service in an attempt to make it more competitive. According to reports, the company is also wooing music artists such as Florence and the Machine and Taylor Swift to offer new songs that will be available exclusively on its platform.
Apple's new music service will most likely be integrated with the next iPhone update which is otherwise known as iOS 9. Rumors say that the company is also designing an Android version of the app, something that would be its first ever Android app.
Other rumors reveal that Apple is set to launch a Beats-based app for its iOS devices. This means that apart from streaming music from popular artists, the company's streaming platform would also be integrated with the Beats brand.
The paid streaming service will not in any way affect iTunes Radio which shall continue as a free service from Apple.
Photo: Sorosh Tavakoli I Flickr