If multiple sources of The Verge are to be believed, the Department of Justice is looking into Apple’s business practises related to the launch of its upcoming music streaming service.
According to the publication’s sources, Apple has been pushing major music labels to make Spotify and other music services shut down their free streaming option. The Cupertino company is trying to convince major music labels from not renewing their music streaming license with Spotify for this.
Apple is yet to launch its own music streaming service, but Spotify is already one of its biggest competitors in the market with 60 millions subscribers. Out of this, only about 15 million subscribers are paid though, which means if Apple manages to convince music labels to get Spotify to kill its free streaming service, the company could lose a substantial chunk of its user base to Apple’s streaming service.
Getting the music labels to kill the freemium tiers from Spotify and others could put Apple in prime position to grab a large swath of new users when it launches its own streaming service, which is widely expected to feature a considerable amount of exclusive content. “All the way up to Tim Cook, these guys are cutthroat,” one music industry source said.
Apple also reportedly offered to pay the licensing fees for YouTube to Universal Music Group if it stopped allowing its songs to be hosted for free on the video streaming website.
Apple’s business practices have forced the DOJ to look into Apple’s deal with other music labels. Thanks to the company’s past behavior, an antitrust monitor from DOJ is already present on its campus, though it is unknown if they are looking into this matter or not. The EU is already investigating Apple over a similar issue.
Apple is expected to launch its own music streaming service at WWDC this year. The service will not offer a free streaming tier, and is instead expected to cost $7.99.
[Via The Verge]