Are Apple scared of Spotify? Rumours of starting a streaming service…

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Rumours are flying around that Apple are considering launching a music streaming service similar to Spotify. The American Billboard magazine reports that Apple have opened “exploratory talks” with record labels about launching such a service.

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Even more surprisingly, the same report suggests Apple are considering launching a version of the iTunes store on Android – which would be a radical departure from Apple’s existing mobile strategy.

The move comes as download sales are collapsing in the face of streaming services. Apparently streaming revenues are up 39% year on year – whilst music downloads are down 3.2%… statistics that will surprise no one, if they’ve been paying attention.

Probably coincidentally, it also emerged today that Apple might soon have to put individual track prices up to account for VAT – which risks making paying to download music on a track-by-track basis even less popular.

Such a move would certainly shake the music streaming business up. Whilst there are plenty of streaming services: Spotify, Rdio, Deezer and so on, none of the big players are yet involved. Apple joining the fray would be a Big Deal – given their marketing power and the fact they control a large proportion of the devices in our hands, they could make an impact – and fast.

The nightmare scenario for the existing providers would be for Apple to drop a huge bombshell – like bundling free streaming with iPhone purchases or their other products. It’d be the same if Amazon did it and bundled music streaming into Amazon Prime, as I hypothesised not so long ago.

Stay tuned for more.

James O’Malley

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