WEBVTT - Bloomberg's Webb on Apple Revamping Its Music Service (Audio)

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<v Speaker 1>You're listening to Taking Stock with Kathleen Hayes and Pim

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<v Speaker 1>Fox on Bloomberg Radio. Apple in the spot line today.

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<v Speaker 1>In fact, the share prices down about one cent to

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<v Speaker 1>nine four six cents a share. But given the news

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<v Speaker 1>out on Apple today, you have to say, maybe it's

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<v Speaker 1>holding up pretty well. Apple's planning to revamp its music

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<v Speaker 1>service after the product was met with tepid reviews, and

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<v Speaker 1>it lost a fight to keep the iPhone name exclusive

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<v Speaker 1>to its product with a Beijing court. So a lot

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<v Speaker 1>of going on, and then there's more signs at the

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<v Speaker 1>smartphone market is sputtering. That's certainly not good for Apple.

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<v Speaker 1>Joining us now from our Bay Area bureau San Francisco

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<v Speaker 1>is it's also the home of Bloomberg. Point one I

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<v Speaker 1>might add is Alex Webb, tech reporter for Bloomberg News.

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<v Speaker 1>So Alex, let's start with the plan to revamp the

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<v Speaker 1>music service. Boy, oh boy, they certainly took a wrong

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<v Speaker 1>turn there. It seems it seems that way a year

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<v Speaker 1>into the products, you've got to maybe give some Yeah,

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<v Speaker 1>they've managed to grow it to the thirteen million users

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<v Speaker 1>that's about a third size of Spotify, but it took

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<v Speaker 1>Spotify eight years to get to the same level. So

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<v Speaker 1>it's not an outright failure, but it has potential to

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<v Speaker 1>be a hell of a lot better. And that's clearly

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<v Speaker 1>why they are working very hard to try and rejig

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<v Speaker 1>it and revamp it. And hopefully we'll see that well.

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<v Speaker 1>Our sources telling us we'll see that products surface at

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<v Speaker 1>their Worldwide Developers Conference in San Francisco next month. Alex

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<v Speaker 1>is there a tale, maybe a novel in the going

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<v Speaker 1>the coming and going of all of the executives who've

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<v Speaker 1>been involved in this music project? I wonder if you

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<v Speaker 1>could just tell us who the players are and Beat

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<v Speaker 1>and bring it all together so it is a wide

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<v Speaker 1>and varied cast of players. And that kind of speaks

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<v Speaker 1>to the very problem with the product that there isn't

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<v Speaker 1>one big figure dictating everything. You have. On the one side,

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<v Speaker 1>the iTunes veterans, people who built the iTunes store. That's

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<v Speaker 1>people like Robert Condrick and in the Apple l A office,

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<v Speaker 1>Jeff Robin, who was an engineer built the original it

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<v Speaker 1>tune store. And then they buy Beats, which was, you know,

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<v Speaker 1>three billion dollar deal. They bring in people like Jimmy Ivying,

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<v Speaker 1>a huge figure in the music industry, Trent Resina, who

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<v Speaker 1>we know is a front amount of nine inch Nails,

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<v Speaker 1>but have been heavily involved with the Beach live streaming service.

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<v Speaker 1>And then there was a guy called Ian Rodgers who

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<v Speaker 1>was sort of, I have some sources, really impressive guy

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<v Speaker 1>in meetings, great ideas, took on other people's ideas. But

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<v Speaker 1>the Apple iTunes people felt a bit flighted when Apple said,

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<v Speaker 1>look at these great people we've hired. They kind of thought, well,

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<v Speaker 1>we've done a pretty good job ourselves. And so there

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<v Speaker 1>was a certain amount of tension between these two sides

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<v Speaker 1>in the development of the product. So Alex quite important

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<v Speaker 1>is it that Apple lost the fight to keep that

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<v Speaker 1>iPhone name exclusive to its products in China, especially at

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<v Speaker 1>a time where suddenly people just don't need to upgrade

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<v Speaker 1>their iPhones the way they used to, certainly not in

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<v Speaker 1>the United States. That's another thing that's hanging over the market,

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<v Speaker 1>the stock market right now. When it comes to Apple,

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<v Speaker 1>I think, in and all of itself, it's probably not

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<v Speaker 1>a huge deal. You know, we're hearing Apple is going

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<v Speaker 1>to probably appeal this um, but it speaks to a

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<v Speaker 1>border trend and it was something that Carla can hinted

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<v Speaker 1>that when he announced that he had divested his Apples stock,

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<v Speaker 1>namely that things are not all plane sailing in China anymore. Um,

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<v Speaker 1>it isn't, you know, untrammeled growth market for them. They

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<v Speaker 1>are facing increasing problems here. We have the I phone issue,

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<v Speaker 1>the branding issue. A couple of weeks ago, we heard

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<v Speaker 1>that that movies and I books have been blocked or

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<v Speaker 1>they've been told they can no longer sell movies and

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<v Speaker 1>books through the iTunes store. So there's an element of,

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<v Speaker 1>you know, I think probably power play on the Chinese

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<v Speaker 1>side saying just remember whose boss. It's us. It's not you,

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<v Speaker 1>the massive mega company. We are the people controlling our

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<v Speaker 1>own market. Thank you very much for joining us. Alex

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<v Speaker 1>Aware but Berg technology reporter joining us from San Francisco,

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<v Speaker 1>talking about Apple shares of Apple down ninety seven cents

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<v Speaker 1>right now and twenty one cents