Apple has a new plan for its most recent music business initiative, hoping to undercut Spotify and other rivals by making its own Beats Music streaming subscription more affordable for users. Re/code has found out that Apple is already negotiating with music labels to cut its costs for streaming music licenses.
Apple apparently believes that $10 is too expensive a monthly expenditure for users interested in music streaming subscriptions, and wants to offer them a cheaper Beats Music subscription in the future. The company would also like to bring some new features to Beats Music, in addition to a new set of rights. However, it’s not known at this time how much Apple would like to charge for its music subscription service, or what new features are in the works.
U2’s Bono recently revealed he’s working closely with Apple on a new, better way for users to enjoy iTunes music, suggesting that Beats Music might be a very big deal for the company and revealing that he plans to help Apple reach 1 billion iTunes customers.
“[One billion users is] 1/7 of the earth’s population. If 1/10 of those people were to be part of a subscription service like Spotify has, and I’m a huge Spotify fan, at $10 a month… Do the math. That’s a billion a month. That’s $12 billion dollars. That’s bigger than the entire music business coming out of one company. Even if it was 5%, now musicians are suddenly in a game that people are ready to pay for, their lives are changed,” Bono said in an interview a few weeks ago.
Just like Beats Music, Spotify also offers users a $10/month music subscription, having recently revealed that it has over 10 million paying customers. Even so, recent survey revealed that just 25% of these customers spend more than $10 on music every three months.
Apple’s discussions with labels are apparently in early stages, and an actual overhaul of Beats Music isn’t expected for this year. Apple has recently denied reports that the Beats Music service will be shut down in the future, and people familiar with the matter told Re/code the company might alter the service over time, without offering additional details.