Apple’s much-anticipated music streaming service has hit a stumbling block as label owners are split over agreeing terms of what industry executives have dubbed “iRadio”.

Despite signing up Universal Music, the largest of the record label majors, the iPhone maker is still negotiating terms with Sony Music, the second-largest recorded music group, while it is close to reaching agreement with Warner Music according to people with knowledge of the discussions.

These people said Apple had first offered a royalty of about 6 cents for every 100 tracks it streams, but had raised this to about 12.5 cents, in line with the rate paid by internet-radio service Pandora. It was unclear whether Universal had accepted the 12.5 cent rate, however, and other labels are thought to be pushing for better terms.