Reuters have broken the story at Apple has held talks with Beats Electronics, the makers of Beats headphones and audio technology found in some HTC phones. Tim Cook, CEO of Apple, is said to have met with Jimmy Iovine, music mogul from Beats, to discuss a joint venture music streaming service.
Beats had already announced that it was getting into the music streaming business back in January with a service codenamed ‘Project Daisy’, although details of what the service would involve remained, with only the quote that ”We need to bring an emotional connection back to the act of music discovery” offering any suggestion of what’s in store from the service. Oddly Spotify, the largest streaming service in the UK and most countries in which it operates, has put a lot of work into music discovery, so it remains to be seen how Project Daisy would differentiate itself. As their brand is based around audio quality one way they could differentiate themselves would be to offer uncompressed audio which is becoming more viable as 4G and fibre optic broadband become more commonplace, and for which quality difference can be heard on high end end headphones. Apple so far have failed to offer this level of quality in iTunes however, and while Spotify don’t state what quality they use it’s unlikely to be uncompressed.
It’s not clear if Dr Dre, the co-founder of Beats and hip hop producer / artist, was present at the meetings. Eddy Cue, head of iTunes, was however suggesting strongly the partnership would be in streaming music. Apple has been rumoured to be looking into a streaming service ever since Spotify started eating into iTunes marketshare. For Apple having a service is a strategic consideration as consumers who switch to using Spotify as their primary music source become smartphone platform agnostic, unlike iTunes which ties them to iOS devices. The service is likely to take the name iRadio despite the fact it’s likely to offer on demand music listening like Spotify rather than customised radio-like music discovery offered by Pandora.
According to a Bloomberg report last October Apple had been looking to launch in the first quarter of 2013 but plans had to be put on hold due to licensing fees negotiations failing to be resolved.
Even if Apple don’t get into music streaming, the market for it is about to have more competition. Alongside current offerings from Spotify, Deezer, Pandora and Rdio giants Google and Amazon are getting ready to enter the market.
According to Iovine, the Beats co-founder and American Idol mentor, he originally pitched a music streaming service idea to Steve Jobs back in 2003, but Apple and the record labels couldn’t agree a workable loyalties arrangement.
If a partnership between Apple and Beats happens we’re unlikely to see the Beats brand added to the phone with Apple very protective about their minimalism. Indeed while Beats are certainly better than music quality on most headphones, many audiophiles question their technology and point to more traditional brands like Shure and Grado having better sound quality for the money.
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Beats Audio coming to iPhones?