Last week rumors were swirling about Apple reportedly sabotaging Tidal’s standing in the App Store ahead of the tech company’s re-launch of Beats Music later this year. Those reports seem legitimate, as Tidal has begun rolling out exclusive content much like Beats is expected to do. With Apple controlling what’s sold in its own app store, it makes sense they’d try to stifle the competition by any means necessary.
Now, however, it sounds like they’re gunning for other music streaming services too. The Verge reports that Apple executives “all the way up to Tim Cook” are pressuring execs at major music labels to put the kibosh on Spotify’s free tier.
Back in March, Rolling Stone reported that many higher-ups at record companies were not happy with Spotify’s free subscription option. “You can’t have a service that’s unlimited, ad-supported, free,” one source told Rolling Stone. “Every other service — Sirius XM, Netflix — doesn’t offer its product unlimited, for free, in any context.”
“You can make the subscription service more attractive, with high-resolution sound or exclusive albums,” said another source, “or you can make the free version worse, by limiting the amount of stuff you can listen to.”
Spotify, which has 60 million global users but only 15 million that pay, has clung to the “freemium” model, saying it’s their best bet for converting new users by first exposing them to the benefits of the service for free, and then getting them hooked. But the labels are tired of waiting for larger numbers of free users to convert to paid subscriptions, and Apple seems to be accelerating their impatience in anticipation of the revamped Beats Music service, which is expected to be rolled out in June at Apple’s annual WWDC.
The Department of Justice is investigating what Apple may or may not be doing to influence record labels to drop Spotify’s free tier. The Verge also claims that Apple offered to pay Youtube’s music licensing fee to Universal Music Group if UMG stopped allowing the video service to host their songs.
If those reports are true, it’s not a stretch of the imagination to picture Jimmy Iovine leveraging his influence in the music industry in efforts to persuade execs to abandon Spotify’s free tier. He’s arguably the most powerful figure in the industry, so when Jimmy speaks, everyone listens. He could be Apple’s secret backroom weapon in the looming streaming wars.