RAIN News reported last week on an EDMbiz presentation by Nielsen Vice President Tatiana Simonian showing further confirmation of the listener migration to online listening. It also confirmed that ad-supported listening is the dominant choice of consumers.
There has been a lot of coverage about the Apple Music presentation last week at the company’s Worldwide Developer Conference (WWDC). However, it’s tough to report on what wasn’t said. There were a number of obvious questions that weren’t answered by the Apple Music executives in the debut presentation. I assume that was intentional.
This morning, Spotify released some new numbers in terms of 75 million active users and 20 million subscribers. Just over one year ago, Spotify announced 40 million active users of which 10 million were subscribers.
There has been a lot of talk since Apple acquired Beats last year about the impact the re-introduced streaming service could have on the industry. When it first came to market, there was widespread speculation that Beats might take market share from Spotify. That didn’t happen. Spotify’s growth only accelerated and Beats all but shut down after the Apple acquisition. Though Yesterday, Apple Music was announced and it sounds very Spotify-like.
Traditional music ownership models benefited tremendously from the ubiquitous ad-supported listening on broadcast radio. Ad-supported listening on Internet radio is the logical complement to the on-demand subscription model and will be the much larger platform for music exposure to consumers and a larger revenue source for artists.
What do industry insiders think are the most important issues and trends facing Internet radio and streaming services? Advertising. You can see this clearly in answers to two of the questions from a recent survey of over 200 people working in the industry.
This past fall there were a lot of comments in the media about Internet radio’s two preeminent revenue models: subscription and ad-supported. Recent data from Strategy Analytics and reported by RAIN News suggests that advertising is the present and future of Internet radio listenership.
Consumers are voting with their ears. While Internet radio may have seemed like a contained novelty on desktop computers, it is an industry-changing phenomenon on mobile devices. Not only has Internet radio’s audience expanded rapidly to nearly 160 million listeners in the United States, but the monthly listening hours are growing at an even faster rate.