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Ever since Apple (Nasdaq: AAPL) announced its latest iPod nano with a built-in FM radio with live pause and iTunes tagging in September, I've been wondering how long it would take to bring the same feature to the iPhone and iPod touch. In fact, I was kind of surprised it wasn't in the new iPod touch, but as the latest rumor suggests, that's not so surprising after all.
The rumor: Apple is busy developing a radio application for the iPhone 3G and 3GS, as well as for the second- and third-generation iPod touch, according to a tipster to 9 to 5 Mac's Seth Weintraub. These models have essentially dormant FM receivers already built into their chipsets, so Apple just needs to wake them up with an app. The key holdup is connecting the iTunes tagging feature to the iTunes store. Why is this so critical for the iPhone and iPod touch and not the iPod nano?
Here's the deal: The iPod nano is not a mobile gateway to the iTunes store. The iPod touch and the the iPhone most certainly are gateways. While tagging songs you like is a fantastic feature, we're not talking instant gratification here. You know how when you're driving down the road and a new song comes on that just fits the moment? The blue sky, the sunshine, the curves in the road and the speed? Oh, man oh man, you're rockin' now. Then later, when you get home, and you listen to the song a few days later, you're like, "What is that? I actually liked that? That guy is wailing and complaining like someone is scratching his chest with a dirty stick!"
Staying in the Moment
With an instant method for buying a new tune, I gotta believe a lot more people will buy a song while on the go -- and while this most likely won't happen while driving in a car already equipped with an FM radio, there's always buying from the seat of a recumbent exercise bike at the local gym. Not only is this an instant sale for Apple and the artists, but it also has the tidy side effect of teaching consumers to buy songs while on the go through their mobile device. Why is this important?
I've purchased a handful of songs and apps directly from my iPhone, but I still prefer browsing via my 24-inch computer monitor. The net result: I'm positive that I end up buying less than I would if mobile browsing and buying were a habit. Apple's move will better connect me to music, which will connect me to the store, which will connect me to buy.
This is a decent alternative to a music subscription plan -- but I'm also sure that, with the right set of tiered pricing, I would subscribe to a music plan and end up spending more on songs each year than I already do -- as long as I could actually own them. Me, I hate the idea of renting songs because there's some inevitable futz up with the DRM or DRM-like controls that mess up my experience. (Yeah, I've got a tiny bit of jealously squirreled away for the Zune model.)
In any event, for those of us who are packing full iPhones, this is a welcome addition. When I travel, I usually fill up on movies at the cost of songs, and often enough, toward the end of a trip, I regret the choice. With a radio, I could not only tune into new radio stations with different programming lineups, but I could also use some of the free space from my expired rented movies to buy new songs.
While we're on the topic of rumors, consider the fabled Apple tablet: If Apple's tablet device does indeed turn out to be an entertainment media monster, wouldn't it be cool if you could use it to listen to the radio, too? Of course, wouldn't Apple also want one-touch buy access?
On the Downside
Radio is a double-edge sword -- you can't control the music, but you get introduced to great new songs and reminded of excellent oldies. At the same time that it's great for getting a taste of the local news and happenings, you're also bombarded with stupid radio jingle ads.
If there's a bigger buzz kill than listening to the local furniture store's going-out-of-business sale head-worm jingle, I'm not sure what it is. Back in 2006, Apple actually sold a separate radio tuner for the iPod, but it cost US$49, effectively killing it. Besides, if you rewind to 2006, songs were still $.99 and there was no mobile iTunes store. The combination of all that never gave it a chance.
Still, the whole success 
of this is tied to radio stations that support tagging -- if a radio station doesn't support it, you're out of luck. Similarly, if you get lousy reception, it's not going to be compelling at all. If we're lucky, Apple will deliver radio to existing customers soon -- maybe even in time for the holidays.
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