Apple's much-touted music streaming service appears to have hit a snag in the negotiations with major labels with Sony Music holding out on the service dubbed 'iRadio'.
According to the US Financial Times Apple have struck a deal with the biggest of the major labels, Universal Music Group, and is close to agreeing a deal with the Warner Music Group but Sony negotiations are proving hard work.
According to sources close to the negotiations Apple had originally offered the labels a royalty of approximately six cents per 100 tracks streamed but upped it closer to Pandorra's 12.5 cents per 100 tracks. With Warner and Sony believed to be pushing for better terms, it's not known if Universal's agreed fee was inline with this. There are also reports that Apple are offering three options for payment – royalty per stream, a cut of advertising revenue or guaranteed fee for the contract.
The streaming service is still believed to take on the Pandorra 'radio' format which will curate a playlist based on a user's listening habits and starting track, rather than a Spotify, Rdio or Daisy 'on-demand' style of allowing users to pick their exact albums and playlists. This is to avoid taking value from the iTunes online store and it is expected that users will be encouraged to buy tracks through iTunes from iRadio – a feature Pandorra doesn't offer.
Originally intended to launch last year, iRadio is now starting to enter the territory of Google's music streaming service which will look to accompany YouTube.
