DOJ SAID TO BE LOOKING INTO APPLE AND FREEMIUM

The Verge reports that Apple is pushing to kill “freemium” streaming at Spotify and elsewhere, prompting Justice Department scrutiny.

The story claims Apple has urged labels to withhold licenses to free-streaming tiers while it readies its own highly anticipated iTunes-Beats subscription service; several label execs are said to have been interviewed by DOJ investigators. It also alleges Apple volunteered to cover the majors’ YouTube licensing monies if they would pull out of the video giant.

"All the way up to Tim Cook, these guys are cutthroat," one unidentified source is quoted as saying.

The allegations follow EU sniffing around similar questions, as reported a month ago. By then a U.S. investigation was already said to be underway. Some observers, meanwhile, have wondered aloud if the story was being advanced by entities with a vested interest in keeping freemium afloat.

Apple, which has yet to announce its streaming service (or sign a single licensing deal on its behalf), declined to comment for The Verge’s story.

Music-industry leaders have been outspoken in their criticism of the ad-supported, all-you-can-eat free streaming model, which generates paltry revenues compared to the subscription model and has been roundly termed “unsustainable.”

Biz reps have also cheered Spotify's efforts to build up its paid user base, now reportedly 15m and growing (roughly 25% of its total users).