Pandora may soon have another rival as Apple is rumored to be currently developing a custom-radio service. A report from Wall Street Journal is saying that the new radio service is designed to work on Apple devices and maybe on computers running Windows operating system. This suggests that the service will be more or less a part of iTunes.
The said radio service will not run on Android devices, said by sources of the report.
As Spotify and Pandora grows in popularity, Apple can see another segment in the market where it can possibly dominate. Experts believe that it can also be a defensive move for Apple so as not to lose customers to the ever-growing threat of both radio services. While Pandora has been around, the service is yet to show profit amidst the company’s claim that it achieved a revenue growth of 51 percent due to high royalty costs in streaming music.
The Wall Street Journal outlined Apple’s strategy in the report. It said that Apple can avoid the financial difficulty Pandora is facing by looking for some workarounds that normally apply to online radio like a ban on playing a particular often. The iPhone maker is said to be in a negotiation with record companies, especially in looking for a cheaper way to pay royalty rates set by the federal government.
Apple was rumored way back 2010 to have been developing this same custom-radio service but nothing materialized. In 2011, Apple tried to explain its side to Financial Times that it was trying to find a way to allow its users to store their music remotely instead of opening a music streaming services that would hurt their profit from its music downloads.
People familiar with the ongoing negotiations, according to WSJ, appear more serious in reaching a working deal compared to the ones years ago.