Maybe Apple's Onto Something with the FM Radio

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With the September 9th Keynote in our rear view mirror, we can begin to look back at it with a more unbiased eye, and explore some of the new features more clearly. It's obvious by now that this wasn't in any way a major announcement. This was exacerbated by the tantalizing rumors that floated all about prior to the Keynote (as I wrote in Apple Rumor Mill Comes Up Empty Again). But one new feature that slipped under the radar a bit was the announcement that for the first time, Apple was including an FM Radio in the Nano line.

"BFD," I hear you say, "so it has a radio. Whooptydoo," which is to be honest, is what I thought until a conversation convinced me that perhaps Apple is onto something a bit deeper.

Buying Songs From The Radio

I was having a casual GTalk conversation with my publisher at FierceContentManagement, Ron Lichtinger, when he pointed out there might be more to this FM Radio than meets the eye. In particular, he suggested, "Being able to buy songs instantly from the radio and storing it on your iPod is pretty darn cool – satellite radio has been doing it for a while, but that’s satellite radio. FM (and High Def) radio are free, but now, you’ll be able to tag and then pay for songs (through iTunes of course) as you’re listening to them." And that's when it hit me that including the FM radio was actually another smart move from Apple

What this does is take the same marketing scheme recording companies have used since the advent of radio, and gives it a new digital twist. Instead of hearing the song on the radio a few times and thinking, 'I really like that. I should get in my car and go to my brick and mortar shop, or buy it the next time I'm in iTunes,' you could potentially click a link and buy it instantly in iTunes. Are you a big fan? Maybe they could try to upsell you to the album, or if you're a really big fan, the Deluxe Album (with extras like unreleased tracks which I wrote about in Apple Brings the Digital Album to iTunes).

Keep Feeding that Cash Cow

This could potentially mean more revenue for the iTunes store of course, which in turn could provide additional revenue for the sagging recording industry at the same time. "With the amount of people that buy iPods, that could be a lot of potential revenue for a beleaguered media format," Lichtinger says. He's right of course. It opens up a potentially large revenue stream where none existed before and it didn't require a huge technological leap for Apple to do it.

The new Deluxe Albums and the FM radio provide a couple of new sources of revenue for the iTunes Store, which has always been a cash cow for Apple. The FM radio, which seemed like a throw-in at first glance, could be so much more than that. Now if they could only put a camera on the Touch and everyone would be happy.