Why Would Apple Be Stingy Here?

Recent reports suggest that Apple (NASDAQ: AAPL  ) is being stingy with trying to ink music-streaming deals. The company has reportedly only offered $0.06 per 100 songs streamed, which is just half of the $0.12 per 100 songs streamed that Pandora Media (NYSE: P  ) pays.

In the video below,'s Alison Southwick and contributor Evan Niu discuss why it seems like a lot of trouble for Apple to nickel and dime record labels.

There's a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple, and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.

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  • Report this Comment On March 08, 2013, at 7:42 PM, marv08 wrote:

    Well, Spotify reportedly pays around 9 cents per 100 songs streamed, and they offer downloading and offline capabilities.

    We do not know what Apple wants to offer. Maybe the want to protect/keep the iTunes music sales business, and will subsequently not offer any offline capabilities... Impossible to compare services without knowing what they offer.

    And then there is volume. The iTunes store has approx. 400 million users in over 120 countries. The total contribution of Apple would beat any other service by far, even at 6 cents per 100 streams. Pandora, Rhapsody or Spotify are not in the same league.

    And there is sales. How many people actually buy songs or albums after hearing them on those services? Apple could offer one-click song/album buying using the same account without ever leaving the streaming application. I can't say how many sales this will bring, but definitely tons more than all existing services combined.

    A bigger, better customer demands better conditions. This is normal. Not stingy.

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