Apple’s (AAPL) iRadio Streaming Service Likely to Launch in 2013 – Expert

By Jan 4, 2013, 5:25 AM Author's Blog  

BTIG analyst Richard Greenfield on Thursday issued a note predicting that Apple (NASDAQ:AAPL) will finally debut its Pandora-like subscription radio service at some point in FY 2013. Previously, there were reports that Apple’s negotiations with major music labels had hit a snag over the issue of a per-song rights fee, but Greenfield says they’re still negotiating on song catalogs.

Apple reportedly wants better licensing rates –usually tenths of a penny per stream — than rival Pandora Media Inc (NYSE:P) because it will also be directing record sales through the App Store.

Dubbed ‘iRadio’, Apple’s upcoming streaming music service is expected to be incorporated into the iTunes app on iOS with personalized radio functionality similar to Pandora, giving listeners an easy way to make purchases as they listen. The service, which Greenfield says will be an integral part of Cupertino’s strategy moving forward, will also be integrated with other music related content such as concert information and tickets via Live Nation Entertainment, Inc. (NYSE:LYV) and Ticketmaster.

Back in October, Bloomberg reported that Apple and music publishers including Vivendi, Universal, Warner, and Sony/ATV-the world’s largest music label, had re-entered intense negotiations and iRadio was set to debut in the first three months of fiscal 2013. CNET then reported in early December that “the deal that Apple had offered for iRadio left the major record companies….cold.”

In cases like this, Apple usually gets its own way. According to Market research company The NPD Group, in the second quarter of 2012 iTunes claimed 64% of the entire digital music market and nearly 30% of all music sold at retail (including both digital and physical formats).

As for other predicted Apple devices, Greenfield says that Apple’s long-rumored ‘iTV’, said to be just around the corner for years, will not debut in 2013 because of content restrictions.

“Despite Tim Cook’s repeated statements that the television is an area of “intense interest” for Apple, the mythical Apple Television is not released in 2013″, the analyst wrote, adding that “the so-called “next big thing” remains hampered by concerns over the legality of the managed/specialized service exception to net neutrality rules, TV Everywhere usage restrictions and solidifying nationwide coverage/accessibility.”

h/t macrumors, macobserver

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