Licensing fees are once again holding up the arrival of Apple's rumored radio service, according to the Financial Times. Apple reportedly has already secured a deal with Universal Music, as was rumored in April, and is close to an agreement with Warner Music. Sony Music ? the second-largest of the major record labels ? is reportedly holding out for more lucrative concessions.
Some industry executives are said to believe that, due to Apple's massive financial reserves and the likelihood that it will make a considerable amount of money off the service, the company should pay out more money to the record labels for permission to stream their product.
Reportedly, Apple initially lowballed the record labels with an offer of 6.5 cents per 100 tracks streamed, roughly half what Internet radio service Pandora pays. The labels rejected that offer, leading to the first reports that the service would be delayed. Apple subsequently offered 12.5 cents per 100 tracks streamed, and the number of labels that have accepted that offer is unclear.
The debut of some sort of Apple-run music streaming service has been predicted since the arrival of iTunes some 10 years ago. Rumors picked up earlier this year when icons hidden inside iOS 6.1 showed "radio buy" buttons tucked into the update, indicating that a service was imminent.
The stalled service, according to reports, features not only music streaming and buying, but also the ability to predict which songs users will enjoy based on what they've listened to before.
Apple, reportedly, is offering the record labels a mix of compensation possibilities: a royalty per track streamed, a share of iRadio's advertising revenue, and a guaranteed minimum payment should the the previous two prove unsatisfactory.