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Apple's $ 1,000 billion market capitalization and acquisition history make it an ideal investor for small businesses. From now on, iHeartMedia is interested in the company's portfolio – or in its sole interest – to preserve its flagship business from bankruptcy. the Financial Times reports today that Apple has spoken to iHeartMedia to potentially acquire a stake in the company, although there is reason to believe that this agreement could be only fictitious.
Formerly known as Clear Channel, iHeartMedia, 10 years old, operates iHeartRadio and broadcasts live over a network of 850 traditional local stations in the United States. It also groups together its own broadcasting and rival radio channels for online listening. Although the growth of the Apple iPod reduced the demand for conventional radio in the mid-2000s, iHeartMedia continued what was left of the business, creating listening apps for more than 90 devices. This process however left the company bankrupt from March 2018, with a debt of 20 billion dollars.
According to FT, iHeartMedia is in the early stages of negotiating with Apple for an equity stake of "millions of dollars", although neither company has responded to requests for comment. Nevertheless, the report speculates that an agreement with iHeartMedia would force Apple Music's Beats 1 station to broadcast radios in cars and kitchens, increase Apple Music's awareness of older audiences, and help Apple win exclusive music contracts that would could otherwise be attributed to Spotify.
Unlike some of Apple's rivals, iHeartMedia has respectfully welcomed the arrival of Apple Music in 2015, claiming there was "definitely a place for both of us" in music. At the time, iHeartMedia considered itself a music conservator, while Apple was primarily a seller, although the market has evolved since; both are currently competing primarily for streaming listeners – simply using different mixes of streaming and audio curation technologies.
Although an agreement between companies is certainly not impossible, it would be fair to call it long. The rumors of potential interest from Apple for all sorts of radio activities were nowhere before, leaving potential big partners such as SiriusXM to fend for themselves in a constantly declining market. IHeartMedia's reach may be more appealing, but its precarious financial situation does not make it an ideal target for investment. Anyway, Apple's floating name as a potential investor could grab the attention that iHeartMedia needs to survive, instead bringing another grabbed contender into its pockets.
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