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Could Apple Offer iTunes Radio for Android Devices?

By Daniel Kobialka - Mar 26, 2014 at 10:00PM

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Apple is considering iTunes Radio for Android smartphones and tablets, which could impact the company in several ways.

Apple ( AAPL 3.55% ) is committed to offering innovative products and services, and the fact that the company could provide iTunes Radio for Android devices shows it's flexible enough to adapt to a rapidly changing technology market. With more consumers selecting Android smartphones and tablets, and the increasing demand for streaming music services, launching iTunes Radio for Android devices could help Apple in a number of ways. 

Will Apple actually launch iTunes Radio for Android devices?
Apple, which earned nearly $60 billion in revenue during the final three months of last year, is carefully considering whether to invest significant resources in providing iTunes Radio for Android devices. Because Apple remains one of the top tech companies in the world, and has plenty of revenue streams (from smartphones, tablets, streaming TV, and much more) already available, it can afford to be patient.

Apple needs to take a close look at its competition before it releases iTunes Radio for Android devices, or risk falling behind rivals, or even alienating consumers. Spotify is currently Apple's biggest competitor among streaming music services, and it offers unique features that make it a favorite for consumers across the globe. Unlike iTunes Radio, Spotify users can listen to specific tracks on demand, which gives this company a minor edge over Apple. If Apple improves iTunes Radio and provides Android users with enhanced features, it could keep pace with Spotify.

However, Spotify could prepare an initial public offering soon, making it even tougher for Apple to gain ground in the streaming music services market. Amazon ( AMZN 2.80% ) also is rumored to be kicking the tires on launching a streaming music service as part of its Prime service, and has increased membership fees to help pay for it.

Will iTunes Radio users pay for a better service?
Apple must determine how much it is willing to invest in its streaming music service. iTunes Radio is free, and Apple uses ads to keep the streaming music service running. But, iTunes Radio users can remove the ads by signing up for iTunes Match at a cost of $24.99 per year, similar to the service offered by Pandora.

Currently, Apple is looking into partnerships with record labels to expand iTunes Radio, but may be forced to do more if it wants to compete with Spotify, Pandora, and other rivals in the streaming music services market. To succeed, Apple may need to lower its price and use that as a selling point, or possibly upgrade its iTunes Radio features (i.e., allow users to listen to specific tracks on demand) to keep pace with rivals.

The bottom line
iTunes Radio still is relatively new; Apple launched the streaming music service last September, and is experimenting to ensure it meets the needs of consumers. There is minimal pressure on Apple to immediately release iTunes Radio for Android devices, but the tech company has an opportunity (albeit a small one) to grow if it launches the service for competing gadgets.

Because improving iTunes Radio only is a small part of what Apple wants to accomplish in 2014, the company can take its time as it considers all of its options for streaming music services. If Apple ultimately decides to launch iTunes Radio for Android devices and improves its music service, the company could soon become a bigger player in the streaming music services market.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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