A few things to note about the new iTunes radio announcement yesterday in AdAge. Apple will generate profit from a solid 3 prong approach.
1) Radio Ads With multimillion dollar contracts from the biggest brand partners, this will finally breath life into iAd. “According to reports, Apple’s iAd staff is responsible for securing the advertising deals that support the streaming music service. iTunes Radio represents a new opportunity for iAd, which was originally envisioned as a way to help developers earn money on the iOS platform. iAd has been historically unsuccessful in terms of attracting both developer interest and revenue, but with the new audio ads, Apple will be able to keep 90% of the money it earns instead of shelling out a large portion to developers.”
2) Push to buy “Apple and its music industry partners think that iTunes Radio’s greatest revenue generator will be its ability to get users to actually buy music. A purchase button will be placed next to every song played on the service in an attempt to get users to permanently add title to their iTunes library.”
3) Upgrades to iTunes Match which is a brilliant service in its own right.
But the real question is What’s in it for Listeners? And that remains to be seen. With on demand services and with multiple other radio options, what’s the true value for me?