All the Music You Can Eat, on Your iPhone? Wall Street Snoozes.

The announcement from RealNetworks that Apple had approved its iPhone app–all you can eat music, to go, for $15 a month–gave the company’s stock a brief jolt.

But that was Thursday, and that’s old news. After a run-up of more than 10 percent, Real’s stock is back in the $3.30 range, where it stood before the iPhone announcement.

The problem: While a lot of digital music nerds I’ve talked to in the last day or so are excited about the app, the first of its kind to hit the market in the U.S., Wall Street seems to think consumers won’t care. They’re just not going to pay a monthly fee to listen to music.

Here’s JP Morgan’s Vasily Karaysov: “Rhapsody’s subscriber base (750K as of Q2 ’09, a decline of 50K sequentially) reflects the existing demand for a subscription-based music service irrespective of the device on which it’s available. We don’t expect the new application to reverse the challenging trend.”

To be fair, Real Networks (RNWK) is a thinly traded stock with other challenges, and it can move for all sorts of reasons. For instance, there has been a bit of buzz about the damages that Real will have to pay Verisign (VRSN), which could be significant.

But I do get the sense that even in the Apple-crazed tech press, which goes bananas for every Apple (AAPL) morsel it can find (true or not), Real’s app seems to have floated under the radar. But Real’s rival, Spotify, whose app does more or less the same thing at the same price but is only available in Europe (for now), says that demand has been overwhelming, so much so that Spotify has had to restrict its offering to new subscribers, at least temporarily. So what gives?

[Image credit: Kaibara87]