At the 2013 Apple Worldwide Developers Conference in San Francisco on June 10, 2013, Apple Inc. announced that it will launch the online radio, iTunes Radio, in late 2013. The release will coincide with iOS 7 and OS X Mavericks and only available in the U.S. Users will be able to skip tracks they don’t want to listen, customize stations, and purchase station songs at the iTunes Store. Those who subscribe to iTunes Match will be able to use ad-free service. It appears that Apple is gearing up to cater to user preferences.
The ad supported service will be free for all iTunes users. A close look at the iTunes licensing agreement reveals that iTunes Radio will initially pay decent royalties until the radio start to generate income. It is anticipated that payment will be around 0.142 cents per stream under the minimum royalty. When Apple start to generate revenue, standard royalty which is 0.13 cents plus 13 percent of the net revenue will kick in and it will be increased in subsequent years. Apple expects to play 15 songs per hour. This will be good for record labels and artists.