Now Apple And Microsoft Are Gunning For Pandora And Spotify

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Photo: Steve Kovach, Business Insider

How much longer will the indies last in online music?Apple is prepping an advertising-supported service to launch next year, Bloomberg just reported.

Meanwhile, Microsoft is giving away a year’s worth of free music to people who line up to buy its Surface tablets, and it’s pushing its free, ad-supported Xbox Music service to people who purchase new Windows PCs and smartphones, too.

These moves threaten Pandora and Spotify on an existential level, since they offer the prospect of gigantic companies with billions of dollars of cash using profitable hardware and software businesses to subsidise music, which is already an iffy business because of licensing schemes that make it hard for online music businesses to make money.

Microsoft and Apple are happy to use music to sell gadgets. Which means that music has become a feature, not a business.

The only bright spot: Nokia tried to bundle free music with phones, and failed.

But we’d bet that the folks at Pandora and Spotify are far happier about the idea of competing with fumbling, debt-laden Nokia than with Apple and Microsoft.

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