Apple is in preliminary discussions with iHeartMedia about a possible deal that would see the iPhone maker possibly take an equity stake in the U.S. radio group as a way of boosting its own streaming services, The Financial Times reports. iHeartMedia has been struggling with $20 billion in debt, resulting in it filing for bankruptcy protection earlier this year; creditors have since been reaching out to potential investors, which may be where Apple comes in. According to one person briefed on the talks, iHeartMedia is hoping that Apple will make a direct investment of “tens of millions of dollars,” although another source suggested that a partnership with Apple may simply result in a large-scale marketing partnership that would see Apple’s Beats 1 radio station debut on traditional broadcast radio, providing greater exposure for Apple Music, particularly among older audiences.
Even in spite of its financial woes, iHeartMedia remains the largest radio broadcaster in the U.S., boasting more than 850 stations from coast to coast, and reaching over 270 million people per month through terrestrial radio, plus another 100 million via its streaming services. This puts it in a key position within the music industry, and one industry executive said that a deal with the broadcaster would be a “power move” by Apple that would significantly bolster its position within the industry for gaining more exclusive and early release deals against rivals such as Spotify. While Apple has traditionally taken a more conservative approach to investments, it’s not hesitant to taking bigger risks within the music industry, such as the famous $3 billion acquisition of Beats in 2014 which served as the foundation for Apple Music, alongside its more recent acquisition of Shazam for improving its music recommendation engine. While Apple certainly has deep enough pockets to help iHeartMedia out of its financial difficulties, it remains unclear exactly what form such a partnership would take. Discussions at this stage are extremely preliminary, and no framework for a deal has been reached. Apple and iHeartMedia both declined to comment. [via iPhone in Canada]