iRadio Imminent? Apple Reportedly Signs Sony, Completing the Music Publishing Trifecta

The rumors of Apple's iRadio service have been swirling around the Internet in recent weeks, and with the report that Apple has signed up Sony/ATV Music Publishing for the rumored service, it seems certain to be revealed by Tim Cook during Apple's World Wide Developers Conference next week, though when it actually launches is still anybody's guess.

According to AllThingsD, a "person familiar with negotiations between the two companies" has said that Apple and Sony Music are all set to stream Sony's song catalogue on Apple's streaming radio service, dubbed "iRadio" by the press. With the acquisition of a licensing agreement with Sony Music, that means Apple now has (reportedly) all three major music labels — Sony/ATV Music Publishing, Warner Music Group, and Universal Music Group — signed on to iRadio.

Apple's streaming service is likely to be an addition to iTunes, which offers a media player and store, along with a current "Radio" section, which is basically nothing more than lists of streaming Internet radio URLs that you can pick up anywhere online.

iRadio, by contrast, will be a lot like the service that the very popular Pandora offers to its 70 million active users. iRadio, a free streaming service, is rumored to have features that allow users to build customized radio stations based on the song or artist they choose to look up. The service would play similar songs based on genre, artist, and other specific qualities of the song, like Pandora, but is also rumored to use your iTunes buying history to further customize iRadio's selection. It is also rumored that there will be a "buy this track" option, much like Pandora, but unlike Pandora, clicking "buy" would, of course, take you only to the iTunes music store, and no other option.

iRadio has recently been rumored to also be ad-supported, which may be one of the the ingredients that has finally ensnared record companies into agreeing to Apple's proposals. According to Billboard, which has sources close to Sony/ATV Music Publishing, Apple has been attempting to get license agreements from music publishers for a while.

Initially, Apple was offering to pay a rate of 4.1 percent of their ad revenue, a rate at which publishers were turning up their nose. Publishers had privately wanted rates of 10 percent to 15 percent. Another holdup on the deals was that Sony Music wanted to get paid, even if users don't like an offering and skip a past song, which Apple wasn't proposing to do (though Pandora does).

Reportedly, the deal has been reached with Apple at 10 percent revenue, which publishers consider an introductory rate and expect to increase as the service becomes popular. They also hope Pandora has to compete and raise its rates. According to Billboard, Apple still seems to be unwilling to pay for skipped songs, but apparently the undetermined advanced payment on the deals from Apple was enough to quiet those concerns for now.

We'll probably have to wait until WWDC and beyond to see what specifics Apple is offering users to try to entice them to use their streaming service, instead of competitors.

And competition they will have. According to Cnet, the aforementioned Pandora is still the top Internet radio service, but Google has recently launched a subscription music service and is purportedly getting ready to launch another music service based on YouTube, through which you can still listen to a lot of free music, though the site is not optimized for it. Spotify, also a subscription service, has been getting much more popular as well.

Meanwhile, music publishers are happy about the competition, because these services, either listener subscription-based or ad-supported, actually pay for the music their users listen to. Another Pandora is better than another Napster.