iTunes Radio

According to a 9to5Mac report, Apple is considering splitting iTunes Radio away from iTunes proper, into a stand alone application. According to the report:

In an effort to boost usage of its new streaming music service that launched alongside iOS 7 last fall, Apple is considering changes to iTunes Radio. The Cupertino company is now testing iTunes Radio as a standalone application with iOS 8, according to sources briefed on the plans.1

This seems to be a good move for Apple, but it also signal some major problems for iTunes proper. According to a report from Billboard, 2013 was the first year that sales of digital media decreased since the iTunes Store opened in 2001:

Overall for the full year 2013, digital track sales fell 5.7% from 1.34 billion units to 1.26 billion units while digital album sales fell 0.1% to 117.6 million units from the previous year’s total of 117.7 million, according to Nielsen SoundScan.2

However, while digital music sales seem to be slipping, streaming is booming. According to the Recording Industry Association of America annual “Music Industry Shipment and Revenue Statistics,” for 2012 – the statistics are backlogged a bit, and 2012 is the most recent data that is available – “Revenues from subscription services and streaming services that do not fall under a statutory license were $570.8 million in 2012, up 58.9% from $359.2 million in 2011.”3 In fact, streaming was one of two segments of the entire US music industry that saw sales increase in 2012; strangely enough, the other segment was vinyl.4

Streaming sales

As it become more and more clear that streaming services will win out, it makes a lot of sense for Apple to launch iTunes Radio as a standalone product. It seems that the streaming space will be getting more competitive in the coming months and years. Samsung just announced their own streaming service, Samsung Milk, Beats Music just launched, and Pandora and iHeartRadio are not going anywhere anytime soon. Here is a more visual look at why Apple is considering the move:

Via Statista

Via Statista

  1. Mark Gurman, 9to5Mac, “iOS 8: Apple considers moving iTunes Radio to its own app to boost usage,” 12 March 2014  
  2. Ed Christman, BillboardBiz, “Digital Music Sales Decrease For First Time in 2013,” January 03, 2014  
  3. Joshua P. Friedlander, “News and Notes on 2012 RIAA Music Industry Shipment and Revenue Statistics” (PDF)  
  4. Ibid