One of Apple’s favourite apps for its upcoming iPhone apps platform: Time Warner’s (TWX) AOL Radio app, which lets iPhone owners listen to some 200 stations, including CBS radio and 25 other genres, for free. Stations will stream over the iPhone’s mobile Internet connection, and will be supported by in-stream audio ads, and potentially graphic ads, Bits’ Saul Hansell reports.
We haven’t had a chance to play with this software yet, but we’re excited about it. The music business should be, too: For years, both labels like Warner Music Group (WMG) and services like Napster (NAPS) have been hoping for a practical way to get consumers to experience music delivered over the air, directly to their phones. With the exception of novelty ringtones, it hasn’t happened (at least not in the U.S.). A working radio app — one that works pretty consistently, doesn’t chew up your battery life, etc — on a phone that’s about to become mainstream would be a huge first step.
On the flip side, it’s more bad news for Sirius (SIRI) and XM (XMSR), which are steadily losing relevance while the FCC sits on their merger deal. If we’re going to listen to music we’re not programming ourselves, it might as well be free and on a gadget we already own. Expect satellite radio growth to continue to slow as more services like this come out.