T-Mobile (NYSE:TMUS) announced that it’s teamed up with Rhapsody to launch unRadio, an ad-free and unlimited music streaming service. According to T-Mobile’s website, Rhapsody unRadio is included in plans with unlimited data, or costs $4 per month for customers on other plans. The service is available on Android and iOS devices, plus on desktop Mac or PC. According to a post on its blog, Rhapsody is also offering the service to non-T-Mobile subscribers for $4.99 per month, or free with a current Rhapsody Premier account.
UnRadio is T-Mobile’s answer to the problems that consumers have with the variety of streaming services that it will compete with. It combines features of services like Spotify and Pandora (NYSE:P) to enable users to listen to programmed stations, or stations that they define based on an artist or song. They can also listen on-demand to 25 songs that they’ve heard and marked as favorites. unRadio also features unlimited skips, no ads, the ability to stream or listen offline, and access to 20 million songs, plus FM and AM radio stations. A “Rhapsody Premier” service will be offered at $5.99 or $9.99 per month, depending on the user’s data plan, and is compatible with Google (NASDAQ:GOOG) Android, Apple‘s (NASDAQ:AAPL) iOS, Microsoft‘s (NASDAQ:MSFT) Windows phones, and BlackBerry (NASDAQ:BBRY)/BB10 devices. The premier service adds the ability to save unlimited “Favorites” offline, unlimited downloads of tracks and albums, plus backward skipping, to the features of the regular service.
T-Mobile markets Rhapsody unRadio as a way to eliminate what Mashable terms “data-suck anxiety.” The idea is to allow customers to stream as much music as they want to, without affecting their bill. Mashable also reports that unRadio will include a feature called TrackMatch, to identify a song that’s played at a party or on television, like Shazam, and create a station based on it.
UnRadio is branded as part of T-Mobile’s “un-carrier” image, which has seen the company move away from binding contracts and do away with early termination fees. Further cultivating that image, T-Mobile made several other announcements on Wednesday, revealing that consumers will be able to test-drive an Apple iPhone (and T-Mobile reception at home or at the office) for seven days before committing to the purchase, and also announcing a feature called Music Freedom that goes far beyond the unlimited streaming offered with Rhapsody unRadio.
The Music Freedom feature will enable subscribers to Simple Choice and Pay in Advance plans to stream unlimited music through a number of apps without the data usage counting against their plan. On its website, T-Mobile lists the included services as Clear Channel’s (NYSE:CCO) iHeartRadio, iTunes Radio, Pandora, Rhapsody, Samsung’s (SSNLF.PK) Milk Music, Slacker, and Spotify. The Verge reports that the forthcoming streaming service from Beatport will also be included, and customers will be able to vote to add more services to the feature via T-Mobile’s website and social media pages.
But as The Verge points out, the move puts T-Mobile on “a terribly slippery slope” as it decides that some music services’ data should count against a cap and others’ should not. Contextualized in the larger debate over net neutrality, T-Mobile is setting a precedent of commercial exemptions, which is problematic despite the fact that music services aren’t paying T-Mobile to be included in the Music Freedom feature. The Verge also equates T-Mobile’s Music Freedom with AT&T’s (NYSE:T) Sponsored Data program, announced earlier this year, that lets companies pay to deliver content to users without it counting against their data plans.
Under both programs, consumers will favor the services that provide content without using up data, and that’s a dangerous advantage to give, whether companies pay for it or not. While both programs initially sound like a good deal for the consumer, their new precedent could very quickly lead to the manipulation of the market by companies carving out an advantage (or carriers playing favorites) with data-exempt content.
Of course, T-Mobile isn’t focusing on Music Freedom’s implications for net neutrality, and links the feature to unRadio, which it says takes Music Freedom “to the next level.” The company introduced unRadio at a time that closely follows the launch of several other music streaming services. Beats Music and Amazon have launched new streaming services this year, and YouTube is expected to launch one over the summer. unRadio is priced squarely in the middle of the existing options, between no-cost options like the ad-supported versions of Pandora and Spotify, and the typical $10 monthly subscription to premium services. Its functionality also comes in somewhere between the baseline services like ad-supported Pandora and Spotify’s premium, on-demand service. And the competing product priced at $4.99, Pandora’s premium Pandora One, is less capable than unRadio.
CNET points out that the Rhapsody/T-Mobile partnership also follows a fairly typical model for music service and carrier partnerships. Under AT&T’s partnership with Beats Music and Spotify’s partnership with Sprint (NYSE:S), the music services were offered as free trials for the carriers’ customers, like the free or discounted options Rhapsody unRadio offers to T-Mobile subscribers.
The Rhapsody unRadio partnership could be a great way for Rhapsody to gain subscribers as it seeks to compete primarily with Pandora. And while internet radio isn’t integral to most consumers’ choice of carrier, T-Mobile’s partnership with Rhapsody will be an extra bullet on the “pros” list for people considering switching to T-Mobile. But more significant for T-Mobile than Rhapsody unRadio is the Music Freedom feature, which could send competitors scrambling to follow suit in offering data-charge-exempt content — or at least see new music streaming services facing an even bigger barrier to entry, even if only on T-Mobile’s network.