Apple is planning to renegotiate the terms with music labels to reduce their revenue cut from its streaming service, according to a Bloomberg report.
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Apple reportedly wants music labels to take a smaller revenue cut from its streaming service (AAPL)
Record labels are reportedly open to renegotiate the terms provided that Apple will maintain growth.
Apple CEO Tim Cook, right, hugs Beats by Dre cofounder and Apple employee Jimmy Iovine.
The deal Apple has with record labels is due to the expire at the end of the month, and it includes both Apple Music as well as iTunes, Apple's digital music store.
Bloomberg's report says that Apple is seeking to give record labels a smaller cut of its streaming service's revenue to get closer to rival Spotify.
The Swedish startup recently closed a deal that reduced the rate from 55% to 52%, Bloomberg says, while Apple Music currently sits at 58%.
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Spotify's revenue hit $3.5 billion (£2.7 billion) last year, and its continued user base growth helped the company to convince music labels to accept the smaller cut.
If Apple wants to come closer to Spotify's rate, it will have to similarly expand its customer base. However, if the Cupertino giant won't be able to seal an agreement with music labels by the end of June, current terms will "likely be extended," Bloomberg reports.
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