Sony Music CEO Doug Morris is in Cannes for the Midem music and technology conference. During an interview over the weekend he said that Apple Inc. (NASDAQ:AAPL) will use Monday’s keynote at the WWDC in San Francisco to announce its new “Apple Music” streaming service.
The announcement will come as no surprise as it has been long expected by observers. Morris’ confirmation of plans to make the announcement tomorrow is meaningful because the partnership of Sony Music is so vital to the launch.
Apple iTunes changed the way music fans purchased their favorite music. Consumers have always been able to purchase “singles” but albums were the more popular format. iTunes made it easy and inexpensive for people to purchase one song at a time and without going to the record store. iTunes helped eliminate the local record store as well. Today, consumers seem to enjoy the affordable option of streaming unlimited music from a nearly endless list of artists on-demand and Apple is going to join the party.
“It’s happening tomorrow,” Morris said during an interview at Midem in Cannes this weekend.
Doug Morris included a 37-year partnership with legendary music producer Jimmy Iovine. Iovine is running Apple’s music services after the company paid $3 billion to purchase Beats. Morris said his relationship with Iovine is strong and that they speak a couple times a day by phone. Morris said it was a brilliant move by Apple to bring Iovine to the company.
Morris is clearly excited about the launch. Although he couldn’t provide details about pricing for Apple Music although he emphasized that he personally prefers the paid streaming model over those supported by advertising believing it makes more sense from a financial perspective. He also feels that the Apple Music streaming service could represent a “tipping point” that could speed up the move to music streaming.
Apple was a pioneer of the digital music download business but in recent years the company has watched consumers move to paid music streaming. During those years the digital music download business has seen decline.
Although no pricing information has been confirmed, it is expected to price somewhere around $9.99 per month which would be similar to established competitor Spotify. Apple is rumored to be in talks with popular musicians and DJs like Drake who could help fans discover new music.
“What does Apple bring to this?” Morris said. “Well, they’ve got $178 billion dollars in the bank. And they have 800 million credit cards in iTunes. Spotify has never really advertised because it’s never been profitable. My guess is that Apple will promote this like crazy and I think that will have a halo effect on the streaming business. “A rising tide will lift all boats,” he added. “It’s the beginning of an amazing moment for our industry.”