Re/Code reports that Apple is talking to the major music labels, looking for a price cut on rights payments so they can sell a revamped Beats Music Service for less than the $10 per month subscription fee it currently charges.
Discussions are in their early stages, sources say, and Apple isn’t planning on overhauling Beats Music until next year. Last month, Apple said a TechCrunch report that the company was planning to “shut down” Beats was not true. But people familiar with the company’s thinking said it might alter the service over time.
When contacted by Re/Code, Apple spokesman Tom Neumayr declined to comment.
Getting music executives to agree to a price cut will be an uphill battle for Apple. Music companies initially resisted the all-you-can-listen-to approach over worries such services would cut down on CD and music download sales. Now, with download sales dropping, revenue from streaming services are a valuable income source for music companies, and they’ll be reluctant to cut fees from the current $10 per month level.
From the other side of the issue, many music industry observers believe there are only a limited number of consumers willing to pay $10 to basically rent music.
