So, you really think Spotify will get to keep its free tier?
Here’s the latest on the negotiations between Apple and the major labels over their upcoming, paid-only streaming service, as reported by the New York Times.
“According to several music executives, who spoke on the condition of anonymity because the talks are private, Apple recently tried but failed to persuade record labels to agree to lower licensing costs that would have let Apple sell subscriptions to its streaming service for $8 a month — a discount from the $10 that has become standard for services like Spotify, Rhapsody and Rdio.
That $2 markdown may be small, but Apple’s failure to secure it reflects a shift in the company’s relationship with the music industry. While Apple once enjoyed enormous negotiating power as the dominant force in digital music — an area it helped pioneer more than a decade ago with music downloads — it now faces an array of new competitors and finds itself in the position of needing to modernize its offerings to catch up to the streaming revolution.
That has weakened Apple’s leverage — and the labels could not be happier about it.”
Image: Doug Morris, CEO and Chairman of Sony Music Entertainment. “Basically, I equate ‘free’ with the decline of the music business,” Morris recently commented.