Apple efforts to end free streaming music on Spotify, YouTube spur DOJ inquiry - report
As it prepares to launch a new streaming music service, Apple is said to be pressuring music labels to force rivals like Spotify to abandon their free tiers — something that has apparently brought scrutiny from the U.S. Department of Justice.
Citing multiple sources, The Verge claimed that Department of Justice officials have already interviewed music industry executives about Apple's business practices. In particular, concerns have been raised about Apple using its influence to persuade labels not to renew licenses with Spotify that allow that company to stream music for free. Additionally, Apple allegedly offered to pay YouTube's music licensing fee to Universal Music Group if the latter pulled its songs from YouTube.
"All the way up to Tim Cook, these guys are cutthroat," one of the sources was quoted as saying.
Discouraging free alternatives could help Apple's upcoming service, but those actions could potentially be deemed anti-competitive by the Department of Justice. Early last month, reports surfaced that Apple may already be facing a probe from the European Commission regarding the same issue.
Past reports have indicated that Apple is hoping to score artist exclusives for its new service, and until recently was trying to push for a monthly subscription fee under the industry-standard $10. Record labels appear to have balked, likely worried that increased subscription numbers wouldn't compensate for missing per-subscription revenue.
Apple could make an announcement as soon as the Worldwide Developers Conference on June 8. Little else is known about what the service might look like, except that it's expected to take on the iTunes name, and mark Apple's first major push into the world of on-demand streaming, which has been slowly eating into the marketshare of the iTunes Store.