Reports: Beats Electronics in talks with AT&T for streaming music service

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Audio technology firm Beats Electronics is in talks with AT&T Mobility (NYSE:T) to bundle its forthcoming Daisy streaming music effort with the mobile operator's data services, CNet reports.

Sources familiar with the talks said Beats co-founder and CEO Jimmy Iovine has met with AT&T and recording industry executives to explore a deal offering AT&T customers a free Daisy trial as part of their existing mobile service in hopes of converting them to full-fledged premium Daisy subscribers. Billboard suggests the agreement could be structured to compensate AT&T for each customer that upgrades to a premium Daisy package.

Spokespeople for AT&T and Beats declined to comment.

Partnering with AT&T would not only allow Beats to leverage the carrier's marketing muscle and subscriber reach but also integrate its monthly fees into customers' existing AT&T bills. AT&T is a logical carrier ally for Beats: Its headphones and audio gear are already sold in AT&T stores, and this spring, the electronics firm offered a pink, Nicki Minaj-endorsed version of its portable Pill speaker as an AT&T exclusive.

Sources told Billboard that Beats is also in discussions with other mobile operators, however, adding that no deals have been closed and negotiations remain in their exploratory stage.

Daisy is scheduled to launch commercially in late 2013. Beats has so far revealed few details about the service. The company acquired digital music provider MOG in mid-2012: MOG offers free and premium streaming access across the mobile and desktop platforms, but it is unclear whether Daisy will follow a similar approach.

In March, Reuters reported that Iovine met with Apple (NASDAQ:AAPL) CEO Tim Cook and Senior Vice President of Internet Software and Services Eddy Cue to discuss Daisy's business model and rollout plans. Sources said Cook and Iovine, who also serves as chairman of record label Interscope-Geffen-A&M, additionally discussed a broad range of music-related subjects. The meeting fueled speculation Apple might partner with Beats on its own streaming music service, but when Apple finally confirmed its plans to launch iTunes Radio last month, the company made no mention of Beats' involvement.

iTunes Radio is expected to go live this fall, ahead of Daisy. Beats also will face stiff competition from established players like Spotify, Rhapsody and Slacker Radio, as well as the fledgling Google (NASDAQ:GOOG) Play Music All Access.

For more:
- read this CNet article
- read this Billboard article

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