Among the bigger-name streaming services are Spotify, which uses a freemium ad-supported, desktop app-based model; Rdio, which takes a tiered, cloud-based approach; and Pandora, whose personalised streaming radio is also available on a freemium ad-supported model. There’s also Wimp, Rara, Napster, We7, Pure, Last.fm, Senzari, Grooveshark, Sony Music Unlimited, Songza, Mog, Samsung Music Hub, and Microsoft’s Xbox Music, to name a few. In total, more than 500 legal music services are operating across the world, together having registered over 13 million paying subscribers - a figure that jumped more than 65 per cent last year, according to the International Federation of the Phonographic Industry’s (IFPI) Digital Music Report 2012 ….
It’s all about access, not ownership. And Freemium. The music business needs to get this, or fold.
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While streaming is especially popular with younger consumers, downloading music through services like iTunes is still a prominent way to listen to music, according to research by AYTM. AYTM’s survey indicated that 37% of US internet users used free music streaming services like Pandora in October. Moreover, 32% paid to download music through a music service like iTunes. Only about 9% paid for a music streaming service like Spotify on a subscription basis that month.
Gerd comments: it’s not rocket-science: cherry picking songs on iTunes feels good to some people because it’s only a $ £ € every now and then, but committing to a monthly fee on Spotify is totally different ( I do, and love it). Neither one will really get EVERY music fan engaged. The solution: Bundle Spotify et al into ISPs, operators, etc, make it ‘feel like free’ ie totally painless for users, then upsell to next levels such as HD, more offline storage, fan clubs, live concert streams etc. Music industry guys: you can’t have the cake and eat it - time to wake up.
Whereas Pandora, and many of its competitors, use a compulsory license to stream music to users, Apple is looking to forge direct deals with labels for more comprehensive and flexible licensing. In other words, Apple radio probably won’t ever tell you that you can’t skip a song. And unlike Pandora, if you want to listen to all Johnny Cash, all the time, Apple won’t fold in music that’s similar to Johnny Cash just to follow licensing requirements. In essence, it is expected to be the best internet radio ever. If real, of course.
Gerd comments: Apple knows that very soon, listening IS THE SAME as downloading - there is no real difference between radio and ‘buying a song’, very soon. Stay tuned.
- In Five Years, Most Africans Will Have Smartphones | TechCrunch (thefuturesagency.com)
- The Future of Music & Media Gerd Leonhard at Plugg Conference 2009 (gerdleonhard.typepad.com)
The Futures Agency (TFA) helps brands, companies, organizations, governments and individuals to better understand - and then, act upon - the challenges and opportunities facing us in the next 3-7 years. We aim to find, filter and share actionable foresights, and work with our clients to imagine and design their preferred futures.
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