/// Apple Wants to Build Its Own Pandora. Why?

September 7, 2012  |  All Things Digital

Apple is talking to the music labels about a streaming music service along the lines of Pandora, says the Wall Street Journal . Industry sources I’ve talked to say that’s correct. And unlike Apple’s long-running but unsuccessful negotiations with the TV Industrial Complex , this one is easy to imagine getting off the ground. The gist: Apple could launch a Pandora clone tomorrow without the labels’ permission, because if it wanted to do a straightforward “Web radio” service, it could use the same compulsory licenses that Pandora and other Web radio services use. Apple will want more flexibility than those licenses provide, so it will need the labels’ permission for that. That’s not a slam dunk but it’s quite doable, because the music industry has become a lot more flexible in the past few years. That’s what happens to an industry after a decade-plus of staggering decline. And in any case the labels are happy to cut deals with Apple. Label chiefs used to blame Apple and its iTunes store for part of their decline, but they’ve gotten over that. And they like generating additional revenue streams. The bigger question is why Apple would want to launch a streaming music service — particularly an ad-supported one like the Journal describes. That’s because ad supported streaming music is a pretty lousy business. It costs a lot of money, and there doesn’t seem to be a whole lot of upside in it

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Apple Wants to Build Its Own Pandora. Why?

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