Apple Music, Spotify, and the fight for the streaming music sector
It’s been more than a month since the much-vaunted launch of Apple Music, an event that was supposed to be a game changer. But so far, things seem to have stayed pretty much as they were. We haven’t seen hoards of people rushing to install it, and talking about the service on the social networks, and most importantly, it doesn’t seem to have caused any problems for its main competitor, Spotify.
And while Google Trends graphics only give us an indication of trends, comparing Apple Music and Spotify searches certainly put things into perspective.
The graph shows Spotify, which has been around for almost seven years, spreading gradually, compared to a relatively new arrival to the scene.
If we use Topsy to see Twitter mentions, a social network that provides a reflection of activity and user interest for one service or the other, after 30 days, the outcome is similar.
Once again, a massive launch, but after a few days, the pattern returns, the new entrant begins to dip, and the service that has been around longer takes the lead.
The thing here is that Apple is not just any old competitor, or some new arrival to the music industry. It is the company that many say has done more to change the industry than any other — an honor I would give to the now defunct Napster and its creator, the great innovator Shawn Fanning — as well as being the most valuable company on the stock markets, with enough cash to buy whatever it likes.
How realistic was it to imagine a mass exodus from Spotify to Apple Musis, taking advantage of that three-month free trial? What does the market Apple is competing for want? During the negotiations, there was talk of Apple’s interest in cutting exclusive deals with record companies, that it would keeping important launches for itself, as well as building walled gardens that only its users would enjoy. Sadly, despite what we said back in April, it doesn’t look as though the company has done any of this, independently of whether some artists decide to offer their music exclusively on Apple.
Apple seems to have understood the structure of the market, and to clearly see that creating restrictions only encourages people to download music from unlicensed sources, which of course continue to operate and a just a click away despite efforts to eradicate them. The reality is simple: if people stop using unlicensed sources, it will be thanks to services like Spotify and Apple Music, which operate on the basis that by paying an amount that users consider reasonable, it is possible to access music conveniently and comfortably.
Nevertheless, Apple Music’s luke-warm start is surprising. The hullaballoo over its launch suggested that this was a bid to take over the market. This clearly hasn’t happened, and what’s more, there has been a lot of negative comment about the service, with talk about compatibility problems with the music libraries that many users already had, along with other glitches.
I have tried Apple Music, and found it wanting in comparison to Spotify. Okay, I’m European, I’m not that demanding in terms of my musical tastes, I have a pathological tendency to be true to products and services that already work for me, and I’m not what you’d call an Apple fanboy (I’m writing this on a MacBook Pro, but I don’t use iPhone or other products, and try to keep a relatively neutral and academic perspective). But again, I am surprised that this obviously very important step for Apple, even if it is a long-term strategy, one month after its launch, seems to be in a catatonic trance.
For me, one of the biggest put-offs to using Apple Music is its tie-in to iTunes, which I think is a disaster, and one of the company’s worst products, which is almost inexplicable. I don’t think I am alone in holding this opinion. Classical music fans also hate it, and Google searches tend to come up with a lot of “iTunes sucks” pages or comments. Basically, iTunes is a disaster, and building Apple Music on top of it is just going to generate confusion and negative perceptions.
Bearing all this in mind, I wouldn’t like to guess how many people who have taken out the three-month free trial will sign up for a $10 a month deal. With Spotify, I feel the opposite: I have the impression that the company’s problem is finding ways to let more people know about its offers, because once they try the premium services, they tend to stick with it. With 75 million active users and 20 paying customers around the world, Spotify has room to grow, but still lacks the resources Apple has. That said, Apple’s very slow start doesn’t look likely to prompt any change in Spotify’s strategy. In fact, it seems that the company already has a plan…
Where are we headed? Very possibly toward an inconclusive competitive scenario, with two companies fighting for the same market but on very different positions, with Google trying to join the party along with a few new entrants such as Tidal, as well as others with a lot to prove if they’re going to find a place in the sun. Apple Music will grow, obviously, but on the basis of what we’ve seen over the last month, the service seems to be no threat, and certainly not what music lovers the world over were waiting for. Nor does it seem that the development of Apple’s music market will depend on it selling more devices, although it could be a strategy down the line.
It was always going to be difficult to break into the music scene, even for the world’s biggest company, and one that already has a certain presence in it. But for the moment, the feeling out there is one of skepticism. Will the company now try some other approach to carve itself out a more privileged position, or will it simply sit back and allow Apple Music to grow on its own. Did you sign up to the free trial, and if so, what’s your experience been, and do you think it really represents a challenge to Spotify?
(En español, aquí)
