Apple Won’t Shut Down Beats Music After All (but Will Probably Rename It)

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Photo by Gary Gershoff/Getty Images for (RED)

This afternoon, TechCrunch reported that Apple was planning to shut down Beats Music, the streaming service founded by Dr. Dre and Jimmy Iovine that the company acquired, along with its headphone brand, for $3 billion. This seemed a bit strange, since Tim Cook has rhapsodized about just how much he loves the subscription service, and the fact that Apple desperately needed to find foothold in streaming. But the story cited five sources, “including several prominent employees at Apple and Beats.”

“It’s not clear when exactly Jimmy Iovine and Dr Dre’s music service will be shut down or what Apple will do with streaming, but every source with knowledge of the situation that we talked to agreed Apple plans to sunset the Beats Music brand,” TechCrunch reported.

Now, Apple has denied the story through it’s spokesman, Tom Neumayr. Except, it’s sort of a nondenial denial. According to Re/code’s Peter Kafka, the “Beats brand may go away,” but the company “wants to stay in streaming music.” Which seems a lot like what TechCrunch said. Here’s a bit more of Kafka for context:

Note that Apple does seem pretty pleased with the iTunes brand, which was the focus of its controversial U2 album giveaway this month.

Shuttering the Beats Music brand name makes some sense, as the company hadn’t generated a ton of traction before Apple bought it in May—at that time, it only had a few hundred thousand subscribers.

Now here’s where TechCrunch reports that Apple might just slap a new name on its Beats, or use its back end (which is the valuable part, anyway) as part of iTunes:

One source said Apple may roll streaming into iTunes. This could be the most logical strategy for Apple if it can find a way to keep its traditional music file download customers happy while opening its catalogue to streaming for early adopters who want to listen from the cloud. Perhaps rather than just buy buttons, there could be play buttons in iTunes, too. Another source said Apple plans to make some significant music announcement in the first half of next year.

Rebranding Beats as part iTunes isn’t quite the same as shutting the service down. But it feels like we’re splitting hairs over headlines here.

In any event, here’s what we can take away from today’s late afternoon music biz news: Streaming is still the future, Apple still seems to realize that, and it’s not going to throw the whole streaming service it just bought into the trash heap because it likes iTunes better.