My understanding is that all they do (or at least used to do) is aggregate streams from different sources into the TuneIn platform. They don't actually host any of streams on their own servers, which means they shouldn't owe royalty fees. TuneIn predates the iHeart and Radio.com (now called Audacy) services, so they were ahead of the ballgame when it came to Mobile streaming. They made their money through visual ads on their app/platform and by playing their own audio and before any stream.
That was my understanding, too. Other than its own channels (which it now offers), TuneIn doesn't pay royalties. I suppose, however, that might've changed now that it has a paid TuneIn On-Air listing for clients. According to what some of my former co-workers at Cumulus have told me, Cumulus was responsible for its own royalties from listeners on iHeart.
Several years ago, iHeart forced them to take down all "Clear Channel" radio streams since TuneIn was profiting from their "work" and obviously taking away users from the iHeart app. But they settled that dispute and now iHeart stations are back on the TuneIn platform.
From what I understand, iHeart handles some of the sales for TuneIn. Adding its stations to the app made sense as it's getting a percentage of the sales.
The problem I have with TuneIn is that they want a subscription for services they once promised under their "Pro" app that was sold on the Apple/Google store.
They also have put services that are free elsewhere behind their subscription wall. I'm not sure why anyone with a brain would pay for their premium service when you can have on-demand subscriptions for a few bucks more per month.
I agree with you on this. I got the TuneIn Pro app before the free version was available. It was either that or WunderRadio, which is now defunct, and TuneIn was on sale at half-price. It was either $0.99 or $1.99 full price at the time. So, I paid less than $1 for it. I think it's almost $10 now, which is totally not worth it. The one thing it does seem to offer that the free version doesn't is the ability to add custom links for streams that aren't on the app. That's a nice feature to have, but I'd use fStream for that if I had to pay what it's charging today. The operations of the app have improved a lot from when it was new. Those early versions were rough, especially once the iPhone 4 came out and had background running apps. TuneIn would deplete your battery quickly if you didn't force quit the app back then. Today, I can use it on my desktop machine at work and continue listening to the same station on my phone if I leave my desk. Granted, Audacy and iHeart offer that, too, but station websites don't.
I added the free version, too, for a brief period because the Waze integration only worked with the free TuneIn app when that feature was first announced. That got fixed pretty quickly, but, of course, I had a two hour drive a day or two after Waze integration was announced.