As Apple works toward a relaunch of its Beats Music streaming service, it’s reportedly pushing labels to kill off the free version of Spotify.
It’s a bold move by Apple if The Verge’s unnamed sources are accurate, coming less than two years after a judge found that the company colluded with ebook publishers to raise prices before the launch of iBooks. Apple is appealing the iBooks verdict, but must comply with an antitrust monitoring program in the meantime. While it’s unclear if the monitor is involved with Apple’s music dealings, the U.S. Department of Justice is reportedly looking into the matter now.
The Verge’s sources believe Apple is trying to create a more hospitable environment for a revamped version of Beats Music, which reportedly has well under 1 million subscribers in its current form. By comparison, Spotify had 15 million paid subscribers as of January, making it the largest subscription-based music service by far.
Spotify built its subscriber base largely on the back of its ad-supported free tier, which lets users listen to any song they want on computers and desktop web browsers. The company’s business model hinges on converting as many of those users as possible to premium memberships, though the mix has hovered around 25 percent paid users for the last couple of years.
While Spotify has the most paid subscribers, it admits that its unpaid user base is eclipsed by that of YouTube. Apple may be going after YouTube as well, The Verge claims, reportedly offering to pay Universal Music Group’s licensing fees if the label stopped allowing its music on the site.
The story behind the story: While this new report doesn’t reflect well on Apple, it’s not as if the company lacks sympathetic ears in the music industry. Artists such as Taylor Swift and Radiohead have complained about how little money they make from Spotify’s free tier, and labels have reportedly been thinking about caps on unpaid listening. Some changes may be afoot even without Apple’s meddling, though the industry needs to tread carefully if it doesn’t want to revitalize piracy.