Apple to Overhaul iTunes Radio as Pandora, Spotify Popularity Grows
April 9, 2014 2:03 PM
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Apple may open up its service to Android
Apple's iTunes Store will reportedly see a shakeup as the company faces increased competition and reduced customer interest in its own offerings.
, Apple is considering an on-demand streaming service, an iTunes store for Google’s Android gadgets and may even negotiate download sales windows.
iTunes Radio back in September 2013
as a way of dipping into the streaming sector, since many customers have moved to those competitive models. But the new service has seen underwhelming interest, with label executives estimating that 1-2 percent of listeners are clicking the "buy" button. Overall downloads have been declining upwards of 15 percent.
To top it off, an independent label said that iTunes’s share of the label’s revenue has decreased from more than 70 percent in 2012 to about 50 percent today -- showing that Apple's power of labels is declining while competitors continue to grow.
Some of the more successful competitors are YouTube, Pandora and Spotify, which offer streaming music and/or video in various ways, such as subscription models.
Apple has reportedly realized that its iTunes Radio has two major issues when comparing it to services by successful competitors: subscription models, and availability for Google's Android operating system.
The download model seems to be old news, as subscription services like Pandora and Spotify continue rising in popularity. Some label executives even said that iTunes Radio could still be a big player in other countries like Russia and Brazil, where "passive" streaming services still haven't caught on the way they have in the U.S. -- suggesting that iTunes Radio won't make it in the U.S. unless it changes its model.
“Two-thirds of its high-value customers are now in subscription services,” said one of
sources regarding Apple. “That has been an eye-opener for them.”
As far as Android goes, the reality is that smartphones running Android accounted for 69.5 percent of sales across 12 key countries in Q4 2013, compared to 23.7 percent for Apple’s iOS. If Apple doesn't open up the service to other platforms, namely Android, it's going to lose a chunk of the market.
Label executives predict that iTunes Radio will be completely different in three to five years as Apple eyes an overhaul that will place its service back at the top spot. Apple hasn't confirmed any changes yet, but it looks like the internal talks have begun.
This article is over a month old, voting and posting comments is disabled
RE: I don't see why anyone would buy music for $1+ per track when
4/11/2014 11:06:31 AM
It really depends on how much you spend on music. If you routinely spend less than $10/month buying music, then that subscription is not a good model.
"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997
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