Apple and MicrosoftGoogle’s All Play could prove troubling for Microsoft’s (MSFT) Xbox Music Pass as users give the new player a try. For Apple (AAPL), the company has yet to release iRadio. Apple is reportedly having trouble signing on BMG. Sony already reportedly rejected Apple’s licensing terms. The negotiation troubles are putting Apple further behind on the streaming audio front. This will give Pandora, Spotify, and Microsoft, now Google a chance to move ahead. Conclusion Investors should not underestimate the entry of Google in streaming music. Users ( postings on the Verge) are already reporting that the radio playlist and the usability are very good. Killer features include the ability to skip songs an unlimited number of times (unlike with Pandora) and downloading the album on device to allow for offline listening. Pandora and Spotify will need to respond by offering the same thing, and much more. This will increase operational costs, and notably R&D costs. In the end, consumers win, but investors of Pandora shares should be cautious.
Written by Chris Lau