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Apple Music-Apple TV Plus bundle hits a snag: Skeptics at record labels

Early talks about Apple offering both services for a single monthly price make some in the music industry nervous, according to an FT report.

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Apple Music has grown popular quickly thanks to the ubiquity of the iPhone. 

Angela Lang/CNET

As Apple prepares to launch its $5-a-month Apple TV Plus rival to Netflix next month, the gadget giant has kicked off early talks with record labels about bundling the streaming-TV service with Apple Music, its streaming-music service -- and at least one big label is wary, according to a report. 

Some labels are open to the idea that Apple would bundle Apple Music with Apple TV Plus for a single monthly price, but people at one big record company have concerns, according to an FT report. The report added that the early-stage talks haven't included discussions of a pricing formula, but some executives are worried about the possible harm of an Apple bundle undercutting the $10 monthly price that Apple Music and virtually all its direct competitors charge.   

Apple declined to comment. Representatives for two major labels -- Warner Music Group and Sony Music Entertainment -- declined to comment, and Universal Music Group (the third of the big three labels) didn't immediately respond to a message seeking comment. 

The societal shift to streaming as the most common way to listen to tunes has been a boon for the record industry. Royalties from subscription services like Apple Music and Spotify have helped propel labels to some of their best growth in years. But the music industry is still licking its wounds from the first era of the digitization of music, when profits were savaged first by file sharing and later by paid downloads with much tighter margins than CDs or other physical music formats. 

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Some in the industry blame Apple's download model -- Apple fought to win deals to sell 99-cent downloads while the music industry was already on its heels fighting piracy -- for the damage that the music industry has only now started recovering from. 

Services like Apple TV Plus and Apple Music are crucial to Apple's goal of igniting its services revenue to $50 billion before 2021. As the gadget giant has launched Apple Music, news subscription Apple News Plus, gaming service Apple Arcade and soon Apple TV Plus, analysts and consumers both have been eyeing the possibility that Apple would offer a mega-media bundle at a discount. 

Disney, meanwhile, plans a discounted bundle of its forthcoming Disney Plus streaming-video service with Hulu and ESPN Plus.

Originally published Oct. 7, 8:48 a.m. PT.
Update, 2:43 p.m. PT: Adds labels declining comment.