Following a report yesterday claiming that Apple was being investigated by the Department of Justice over anti-competitive practices surrounding the launch of its rebranded Beats streaming music service, Bloomberg this evening now corroborates that report. Bloomberg says that the Federal Trade Commission is investigating whether Apple is using its large iTunes store to put rival streaming music services like Spotify at a disadvantage.
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FTC officials have reportedly been in contact with at least one record label regarding Apple’s practices. Some of the concerns allegedly surround Apple’s negotiations with artists for exclusive rights to content. The FTC investigation is centered around the question of whether Apple’s efforts will change how music labels behave with other streaming music services. One example of this would be labels reducing the music available to ad-supported services in favor of Apple’s paid tiers.
Music industry executives, however, say that Apple has not placed any sort of demands on the labels, according to the report.
The FTC investigation, which is still in the early stages, is asking whether Apple’s efforts will change the way music labels work with other streaming services, for example curtailing ad-supported music and pushing more songs into paid tiers of service at higher rates, according to one of the people.
Apple hasn’t made such demands on the labels, according to the music-industry executives.
Earlier this year it was reported that Jimmy Iovine, who is working on Apple’s rebranded streaming music service, tried to lure key artists away from Jay Z’s Tidal streaming service. Apple, of course, is no stranger to federal investigation, with the company being found guilty of anti-competitive practices in a long-running ebook case last year, eventually settling the case for $450M.
Apple is expected to relaunch Beats Music at WWDC in June, despite contrary reports, and integrate it into a redesigned Music application. The company is reportedly aiming at a $7.99/month price point.