Dive Brief:
-
Apple Inc. is working to persuade record labels to release more new music exclusively through its iTunes Store for a longer window of time.
-
That would effectively stymie the efforts of streaming services like Spotify, Pandora, Beats Music, and Deezer, which are increasingly becoming popular as they’ve become easier to use on devices like smartphones.
-
Those services are the likely reason that digital music downloads have begun to slump after a good decade of steady growth.
Dive Insight:
Considering Apple Inc. already has 80% of U.S. digital music download sales, this move feels a little desperate, but the company is probably very aware of the effect iTunes' rise has had on record stores. Although iTunes radio was a little late to the party, it’s had success going up against music streaming services like Spotify. But that isn’t good enough for Apple, which is asking record labels for a longer window of exclusively before new releases become available elsewhere to stream. This may be a losing battle for Apple — a lot depends on what the consumer demands — but labels don’t make a lot off streaming services right now. Plus, it’s hard to really fight against the retailer with 80% share of the market. And what about record stores? No one's worried about them cutting into sales.