Spotify and Pandora to FACE THE MUSIC as iRadio inks Sony deal

Apple has now struck deals with all three major record labels for use of their music on its new online "radio" service, set to launch next week.

The fruity firm has reportedly inked an agreement with Sony, sparking furious speculation that a free iRadio service will be unveiled at next week's WWDC.

Apple had already signed up Universal Music and Warner Music. It is understood that the hold-up with Sony was down to a quibble over how much Apple should pay the label when people listen to a portion of a song and then skip it. Other services limit this ability. Pandora, for instance, allows users six skips per station in an hour, up to a maximum of 12 in a day.

Apple iTunes currently takes 30 percent on the sale of each song. It is not known what the terms of iRadio will be, but the labels are likely to have been interested in striking a better deal.

Just like the free version of Spotify, Apple will pay for the iRadio by selling advertising, according to sources quoted in an advertising industry magazine.

Apple is likely to be able to target its ads better than Pandora, because it holds more information about customers. The better targeted an advert is, the more it can generally be sold for. This could be key in the battle against Pandora, as iTunes has access to the credit card details and addresses of all customers that currently buy songs from it.

However, like Pandora, iRadio is rumoured to lack the option to search for and play specific songs. If so, this will give Spotify a clear advantage, as both free and paid-for versions of this dominant music streaming service offer search facilities. ®