What Apple didn't announce: In search of a streaming music service

Sure Apple has the Beatles, but the question everyone wants to know is this: When exactly is that streaming music service launching?
Written by Larry Dignan, Contributor on

Sure Apple has the Beatles, but the question everyone wants to know is this: When exactly is that streaming music service launching?

So far we know the following:

  • Apple's North Carolina data center is on track for a December quarter launch.
  • Apple bought streaming music service LaLa.
  • And the company has some yet-to-be-disclosed cloud strategy.

Simply put, a lot of observers just don't care about the Beatles on iTunes. If you love the Beatles, you have already ripped the music from CDs.

But the streaming music service, that's a different story entirely. Here's what a few analysts have said about the big Apple let-down on Tuesday.

Piper Jaffray Gene Munster said:

Apple did not announce a cloud-based iTunes streaming service today, as we were expecting. Apple is building a large data center in North Carolina that we believe could serve as the hub for a hosted iTunes streaming service. We continue to believe it is only a matter of time before Apple launches a cloud-based iTunes service. Apple could leverage its connected devices (iPhone, iPad, etc.) along with cloud-storage for streaming iTunes content. Steve Jobs has indicated that syncing is a problem for consumers and a hosted solution could solve the syncing problem. Apple has built a data center that will be completed this quarter.

And then there's Jefferies analyst Peter Misek, who was far less optimistic about Apple doing streaming music. Misek said:

We think music studios are pushing back significantly against Apple's overtures, partially due to price. We believe the main sticking point is that the music studios do not want to be locked into an Apple music-streaming monopoly and would prefer the development of competitive offerings. Potential partners could include large Internet players with cloud-based computing initiatives who either have or would like to have a social networking platform. Apple's $1B data center in North Carolina should be completed by year end. Without studio support, Apple may expand its cloud-based MobileMe offering. In the future, Apple could use the facility for cloud-based video but may wait for expanded LTE coverage. Our checks indicate much stronger shipments of Apple TV, but the installed base is still too small to require such a large data center footprint.

Misek's take raises an interesting question. Did Apple build a massive data center for a streaming music party where no one showed up?

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