The State of Apple Music and Streaming
In terms of numbers, there were an average of more than 18 million music subscriptions during the first half of this year, which is double the number reported at the same time last year. “Music subscriptions are now significantly bigger revenue generators than CD sales, and virtually equal to permanent downloads,” Sherman writes.
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Citing label executives, Bloomberg reports that most Apple Music subscribers are people new to streaming services, not former Spotify users. Spotify is believed to have around 40 million paid users, while Apple has 17 million as of earlier this month.
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Sherman notes that while a song streamed from YouTube is no different for the fan, it’s dramatically different for the artists and labels. Sherman also put Spotify’s free streaming tier in the same boat, noting that the payout differences between free music streaming and paid is “jarring and indefensible.”
Spotify was founded about ten years ago and is currently available on 8 OSes and offers a free tier. AppleMusic was started fourteen months ago and is available on 3 OSes and offers no free tier.
Spotify relies solely on the revenue of their music services, whereas Apple relies on hardware sales for their main source of revenues and profits.
No one is profitable with streaming services, yet.
Anecdotally, the recommendations I’ve received from Spotify have generally been more well-rounded in almost all regards, despite using the service less than I do Apple Music or local playback. I also appreciate Spotify’s large variety of community-created playlists.
But I’d rather pay for just one streaming service, and I’d prefer to use the one that’s integrated into the applications I use most: Music on iOS, and iTunes on my Mac. Unfortunately, as I’ve written before, its recommendations have been lacklustre.
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It remains a complete mystery to me why the rest of Apple Music’s recommendation features are not using iTunes playback and rating data, nor the previously-collected Genius data.
Peter Kirn (via Michael Yacavone):
And there, unless you’re a big artist or label, the relationship hasn’t been great, either. I’ve yet to talk to many labels or artists happy with their experience dealing with Apple; by comparison, I’m hearing more positive feedback about Spotify. That’s qualitative and just hearsay, but I can’t find material evidence that Apple Music is a place where smaller- and medium-sized artists see much control. Spotify and Pandora are adding new artist connect features, whereas Apple, as Hypebot noted this month, is backing off of its Connect service. What we get instead is front-and-center machine algorithm streams, despite Apple saying publicly that they’ll do more human curation.
Matthew Garrahan et al. (via John Gruber):
Spotify, the music streaming service, is in advanced talks to acquire SoundCloud, as competition heats up with Apple for the future of digital music, said people briefed on the discussions.
SoundCloud, which raised $100m in June from a group of investors including Twitter, was last valued at about $700m.
