iHeartMedia Hopes that Apple will take a stake in the company as Time is running out for them with the Bankruptcy Court
The Financial Times is reporting that Apple is exploring a tie-up with iHeartMedia, the Largest US radio group that announced on Monday that it had expanded into Mexico. The company filed for bankruptcy under Chapter 11 back in March 2018. Creditors of iHeartMedia have been contacting potential investors ahead of a deadline later this month to file a reorganization plan with the bankruptcy court. The company is saddled with $20 billion in debt. The company has been rapidly losing out to digital music services from Apple, Spotify and Pandora.
It's difficult to see why Apple would be interested in "taking an equity stake" in iHeartMedia as is hoped for by the company. The leaked news that Apple has shown interest in the company seems to be more of a desperate move to get high publicity for their problem by mentioning the Apple brand.
With that said, the Financial Times reports that "a partnership with iHearMedia could see Apple Music's Beats 1 radio station, available only though its app, make its debut on broadcast radio. Extra distribution would give Beats and Apple Music in general greater awareness among older audience that have been slow to adopt streaming services. Some kind of deal with iHeartMedia would put Apple's Beats 1 into more cars and kitchens.
Despite iHeartMedia’s financial difficulties, it remains the largest radio broadcaster in the US, operating more than 850 stations across the country. That makes it valuable to the music industry and its promoters, especially when it comes to breaking new acts or building awareness of the latest releases.
If Apple were to build closer ties with the network, it might be able to increase its influence in the industry. One music industry executive described the potential deal as a "power move" by Apple, which is constantly vying with Spotify to persuade more artists and labels to strike exclusive or early releases for its streaming service." For more on this check out the full Financial Times report here.