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Apple signs up Warner for iRadio

By | Published on Monday 3 June 2013


Apple has signed up the Warner Music Group for its long mooted iRadio service in a deal which is significant because it means another major label is now on board, but also because this agreement includes publishing rights, something the tech giant has so far been struggling to secure for its planned streaming venture.

As previously reported, Apple has already signed up Universal Music on the recordings side for its planned Pandora-style music service, which many still think will be a gamechanger in the increasingly competitive streaming audio market given the dominance of iTunes in the download domain. So Sony Music remains the major label hold out.

But on the music publishing side, Apple still needs to persuade both the Universal and Sony/ATV publishing companies to do the deal. The tech giant finally got to the negotiating table on iRadio just as the big publishers, especially in the States, were rethinking their approach to digital licensing, with moves to licence services directly rather than via their collecting societies, motivated by the prospect of securing a bigger slice of the royalties pie that way.

As with all things streaming audio, the terms of Apple’s deals with Universal and Warner are shrouded in secrecy, though insiders say that just like Universal secured a significantly better deal on the recordings side than the Apple chiefs first offered, Warner has likewise upped the payouts on the publishing side too.

Though according to the Wall Street Journal, the tech firm has given way most on ad revenue share, offering the publisher 10% of ad income linked to its content, double what Pandora apparently pays the owner of publishing rights (bearing in mind the record label will demand the lion’s share). Apple has been most willing to negotiate on ad revenue splits from the start, because it shares the risk better than giving way to higher advances and minimum guarantees, though there has been some give there too according to insider chatter.

Whether all the give on recording and publishing deals will be enough to satisfy the Sony record and song rights companies remains to be seen, and talk of deals with the indies has been lacking so far, though the Journal reckons Apple bosses are still keen to make some kind of solid announcement about their entry into the streaming music space at their annual developer’s conference which takes place in San Francisco later this month.