According to Billboard, Universal declined to sign a two-year contract with Apple and has instead chosen to enter into month-to-month deals. The move would allow Universal to remove its songs from the iTunes service on short notice if the two sides do not agree on pricing or other terms in the future.
"UMG doesn't have long-term agreements with other retailers. So why Apple?" added the source.
The move is expected to loosen Apple's grip on the online music market, the company generates more than 70% of all online music sales worldwide and will be facing stiff competition from Amazon's download service which is slated to launch soon. The success of the new iPhone could also be derailed.
UMG is the biggest music corporation, home to artists like, Tupac Shakur, Akon, Mariah Carey, Eminem, Amy Winehouse and 50 Cent. Universal and Apple representatives declined to comment.