Apple Inc. (NASDAQ:AAPL) has said that it will begin to charge its customers for listening to the iTunes Radio as from 28th of January. In an email that has been sent out to its customers, the company says that it has developed a system in which all its radio stations will now be available to customers who are members of Apple Music. What this means is that one has to subscribe to Apple Music in order to be able to access iTunes Radio. Subscription to Apple Music costs about $10 per month.
However, the company has excluded Beats 1 from the arrangement. Beats 1 is a service that allows you to listen to a select group of songs that have been mixed by specific DJs contracted to do so by the company. Listening to Beats 1 is set to remain free in the meantime.
This news may not be a shocker to many. For years, Apple Inc. (NASDAQ:AAPL), and many other companies for that matter, has been known to adjust its product offerings to respond to changes in market dynamics. Back in June last year, the company decided to get out of the mobile advertising business.
The decision to do so was reached after the company realized that staying in the mobile advertising business was not helping it to achieve its short term and long term strategic objectives at all. Then on Friday last week, the company announces that it is also changing the manner in which it sells iTunes Radio by forcing all clients to pay for the service.
There are several factors that may have led the company to make this latest decision. The first one appears to be Spotify. Over the recent past, Spotify has been growing in its business of streaming music to listeners online. Listeners can subscribe to membership plans and listen to different types of music on the platform.
Individuals who have subscribed to a specific membership plan can listen to music without being interrupted by ads. Otherwise, free listening comes with ads. Apple seems to have realised that Spotify is now becoming its primary competitor. This explains why the company decided to terminate its free iTunes Radio service and force its customers to subscribe to its Apple Music service.
What is important is how the erstwhile lovers of iTunes Radio are going to react to the news. Primarily, users have been enjoying a wide variety of music through the many stations that are available on the service.
Stations are based on either specific genres or artists and are developed through a complex process. Now that users have to join Apple Music in order to access their stations in the next few weeks, it remains to be seen how the customers will react to the news.