Apple has held talks with Beats Electronics LLC, the audio technology firm co-founded by influential hip-hop producer Dr Dre and music mogul Jimmy Iovine, on a potential partnership involving Beats' planned music-streaming service, three people familiar with the situation told Reuters.
Apple chief executive Tim Cook met with Beats CEO Jimmy Iovine during a visit to Los Angeles in late February to find out more about Beats' "Project Daisy", a music subscription service the company announced in January but with scant detail, the sources said.
Apple's internet products chief Eddy Cue, a key player in setting up its iTunes Music Store, also joined the meeting, at which Cook expressed interest in Daisy's business model and its rollout plans, although the two did not discuss specifics of a deal, the sources said.
The meeting between Cook and Iovine, who is also chairman of music company Interscope-Geffen-A&M, was "informational" and covered a broad range of music-related topics, the sources said.
Apple spokesman Tom Neumayr and Beats declined to comment.
The iPhone maker has been widely reported to be considering a music-streaming service to complement iTunes, the largest repository of music for sale.
Beats, known for its stylistic, distinctive headphones, has a partnership with Taiwanese handset maker HTC, an Apple rival.
In a boost for the company, Beats said on Tuesday it had secured $US60 million in funding for Daisy from a group of investors including Warner Music owner Len Blavatnik, Fort Worth billionaire Lee M. Bass, and Australian financier James Packer. The funding will bankroll the music service's launch in late 2013.
Hungry for growth
Beats reportedly named the project "Daisy" in honour of what it called the first digital, computerised song. At the time, it said in a press release that the service would "bring an emotional connection back to the act of music discovery," referring to the process through which users find, buy and consume music.
The music recording industry has languished through more than a decade of declining revenues and sputtering growth. Industry sources say many of the largest companies are beginning to warm to the idea of collecting fees on music streamed over the internet, as the use of smartphones and tablets explodes around the world.
It remains a nascent market, dwarfed by music sales via outlets such as iTunes, but one that is attracting investment.
The meeting between Apple and Iovine was set up in January, immediately after Beats announced Daisy without explaining the upcoming project's business model or how it plans to differentiate itself from existing services such as Spotify and Pandora, one of the sources said.
Other players reportedly looking at expanding into music-streaming -- whether fee-based or by paid subscription -- include Google and Amazon.com.
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