Apple's (AAPL) Initial Offers for Content are 'Way Too Cheap', Labels Say
According to the NY Post on Thursday, Apple (Nasdaq: AAPL) has reportedly opened-up discussions with record labels over getting rights for a potential music-streaming service. Apple isn't getting very far, however, given that it's offers are coming in "way too cheap."
The Post cites sources in saying Apple initially offered six cents for every 100 songs streamed, which is about half the 12 cents that Pandora (NYSE: P) pays out.
Though many in the industry admit that working with Apple would open a whole new revenue stream, many are reluctant to take the offer given recent battles over preventing Pandora from lowering its rate. Some insiders believe that Apple should pay the industry standard set by the Copyright Royalty Board of 21 cents per 100 songs, which applies to companies that don't own broadcast operations.
Notably, Apple CEO Tim Cook met with Beats Electronics earlier in the week, though no formal discussions of a partnership were reported.
Apple's potential 'iRadio' would be ad supported, the Post reports, while music labels would want an upfront fee and percentage of the ad revs.
Apple might also release iRadio in a bundle with iWatch, another potential late-2013 release.
Along with Apple, Google (Nasdaq: GOOG) and Amazon (Nasdaq: AMZN) are also mulling a stronger push into streaming radio.
Apple is trading lower ahead of the opening bell Thursday.
The Post cites sources in saying Apple initially offered six cents for every 100 songs streamed, which is about half the 12 cents that Pandora (NYSE: P) pays out.
Though many in the industry admit that working with Apple would open a whole new revenue stream, many are reluctant to take the offer given recent battles over preventing Pandora from lowering its rate. Some insiders believe that Apple should pay the industry standard set by the Copyright Royalty Board of 21 cents per 100 songs, which applies to companies that don't own broadcast operations.
Notably, Apple CEO Tim Cook met with Beats Electronics earlier in the week, though no formal discussions of a partnership were reported.
Apple's potential 'iRadio' would be ad supported, the Post reports, while music labels would want an upfront fee and percentage of the ad revs.
Apple might also release iRadio in a bundle with iWatch, another potential late-2013 release.
Along with Apple, Google (Nasdaq: GOOG) and Amazon (Nasdaq: AMZN) are also mulling a stronger push into streaming radio.
Apple is trading lower ahead of the opening bell Thursday.