Tesla has held talks with record labels about creating its own streaming service

Shawn Knight

TechSpot Staff
Staff member

Electric automaker Tesla is reportedly interested in getting into the streaming music business. Sources within the industry tell Recode that the carmaker has held talks with all of the major record labels with regard to creating a proprietary streaming music service that would be bundled with its vehicles.

Although the sources admit that they aren’t fully in-the-know, it would seem as though Tesla is interested in a multi-tiered platform with a base-level web radio offering similar to Pandora.

The chatter begs the question – why would Tesla bother with creating its own service when it would seemingly be cheaper and easier to partner with an existing player like Spotify, Apple Music or Napster to integrate their service into vehicles’ infotainment systems?

My guess is that it’d be cheaper to work a deal directly with music labels versus going through an existing provider.

A Tesla spokesperson told the publication that they believe it’s important to have an exceptional in-car experience so their customers can listen to the music they want from whatever source they choose. Tesla’s goal, the spokesperson added, is to simply achieve maximum happiness for their customers.

Recode notes that Tesla already offers a deal with Spotify – which now has more than 140 million monthly active users (of which around 50 million are paid subscribers) – for vehicles sold outside of the US.

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captaincranky

TechSpot Addict
...[ ]....My guess is that it'd be cheaper to work a deal directly with music labels versus going through an existing provider.....[ ]....
My guess is that it's because there's simply no limit to Elon Musk's greed. (Which is basically the same as your guess, except that it's phrased by, and for, non-staffers..(y)

It's a shame that humans can't physically, "get a big head", from a massively over inflated ego. Because if it were possible, Musk could give "the Elephant Man" a run for his money and then some !:eek: :D
 

SirDigby

TS Evangelist
Platinum
From my point of view I would've thought there'd be a really good opportunity to make business partnerships here, so I'm confused why they'd take the lonesome road, even if they'd end up making more cash, especially when the cost of a music streaming service is pittance compared to the price of even the cheapest Tesla car. £10 a month here for Spotify, likewise for Apple Music and Google Music, compared to something like £30,000 for a Tesla. You could offer lifetime free music streaming and barely take a dent in your profit margin (I presume, not sure what the production or R&D costs are comparatively), and that's consumer costs not wholesale.

Tesla and Apple have a bit of a rivalry at the moment, trying to pinch each other's top tech engineers for projects, software dev etc. It would a) be a good opportunity to build a bridge rather than burn it, or b) be a good opportunity to side with one of Apple's rivals in the arena like Spotify or Google. (I'd prefer Spotify, excellent app, software, 320kbps quality, massive music catalogue and they're technically still not making profit so I consider them an 'underdog')

Or, more realistically, they could partner with Google, one of the few companies that actually stands a chance against Apple's ever growing empire.

I just don't see the benefit of going the lonesome road when you are almost certainly going to be outmatched, outnumbered, outgunned etc. It's not impossible, just much more effort than it's worth.