Apple Music Growing at Record Pace With Two Million Subscribers Added in Just Five Weeks

[MacRumors]

Apple's services chief Eddy Cue, who spoke at the SXSW media festival in Austin, Texas this week, revealed that Apple Music now has 38 million paying subscribers worldwide. Cue also said there are over eight million customers that are currently taking advantage of Apple Music's free three-month trial period.

The Wall Street Journal confirmed that Apple Music had 36 million subscribers in a February 4 report, so it appears the streaming music service has gained around two million subscribers in just over five weeks.

The numbers suggest Apple Music is growing at a clip of roughly 400,000 subscribers per week, or 1.6 million per month. Accordingly, it would appear to be Apple Music's fastest growth rate since it launched in June 2015, at least based on the figures that Apple has publicly shared over the past three years.

Apple Music Subscribers
Oct 2015: 6.5 million
Jan 2016: 10 million
Feb 2016: 11 million
Apr 2016: 13 million
Jun 2016: 15 million
Sep 2016: 17 million
Dec 2016: 20 million
Jun 2017: 27 million
Sep 2017: 30 million
Feb 2018: 36 million
Mar 2018: 38 millionSpotify maintains a sizeable lead over Apple Music. The streaming music service revealed that it had 71 million paying subscribers as of the end of 2017, so it should be around twice as large as Apple Music by now. Spotify also has a free, ad-supported tier, giving it over 159 million listeners overall around the world.

Apple Music appears to be gaining ground on Spotify, however, and could reportedly eclipse its biggest rival in terms of U.S. subscribers later this year. The chart below from Apple analyst Horace Dediu is based on global subscribers.

Spotify vs. Apple Music Subscriber ramps. pic.twitter.com/wFVoZhe1Nk - Horace Dediu (@asymco) March 13, 2018

Spotify launched in 2008, and expanded to the United States in 2011, while Apple Music debuted in over 100 countries at once in 2015. Both platforms offer individual subscriptions for $9.99 per month, student plans for $4.99 per month, and family plans sharable with up to six people for $14.99 per month.

Apple Music has the benefit of being preinstalled on hundreds of millions of iPhones and iPads. It's also available on Mac, PC, Android, Apple Watch, Apple TV, vehicles equipped with CarPlay, Sonos, and HomePod.

At SXSW, Cue estimated there are around two billion people that have access to and a means to pay for streaming music, suggesting the market is ripe for growth. Apple Music and Spotify have around 110 million subscribers combined, so there is clearly an opportunity for both services to continue growing.

The harder task for Spotify will be turning a profit, which it has yet to do. Apple Music executive and record industry mogul Jimmy Iovine recently said streaming music services are "not making any money" due to a lack of margins, suggesting that a standard $9.99 per month subscription is not profitable.

Apple Music's profitability is likely less of a concern for Apple, as it sells a wide range of other products and services. Apple's broad services category brought in a record $8.5 billion revenue last quarter, up 18 percent year over year.

Article Link: Apple Music Growing at Record Pace With Two Million Subscribers Added in Just Five Weeks

 

[mtneer]

Is this the HomePod effect?

 

[blacktape242]

now start a movie service with apple's catalog.

 

[OldSchoolMacGuy]

Spotify is in for a bad time.

 

[belvdr]

Is this the HomePod effect?

I wondered that too. I simply use the free streaming options, as I use it very little.

 

[cliffster82]

Is this the HomePod effect?

Came here with the same thought. Definitely partially due to people buying HomePods and starting their free trial.

 

[G65S]

Came here with the same thought. Definitely partially due to people buying HomePods and starting their free trial.

38 million PAYING members. Cue also said there are currently over 8 million ppl who are in the 3 month trial right now.

 

[Jaybee75]

I guess that Spotifys "free" subscription prevents them from making any profit. I don't know how much advertising you get but, i can't imagine that it generates enough turnover to cover the license fees. Apple offers just a free trial and then you have to pay. Less customers but not a sinkhole for money.

j.

 

[RudySnow]

Came here with the same thought. Definitely partially due to people buying HomePods and starting their free trial.

Could also be a mix of people who exhausted their three-month trial after Christmas and are now entering the paid tier?

 

[macduke]

The thing that bothers me most about Apple Music is how I can't toggle explicit music easily for when my kids are in the car or if I put something on my living room soundbar through my Apple TV. Not that I listen to a lot of raunchy music anyway, but a lot of songs have slight radio edits and when I turn off explicit deep in the system settings, it usually means that I can't play any songs that have a curse word at all. They don't get replaced with the radio version. Drives me crazy!

 

[jadot]

EE are 'giving away' 6 months of Apple Music Subscription with a lot of their cellular plans at the moment in the UK.
Apple Music is a good service. I used it for a while there, but changed over to Amazon Music a few months ago so I could get myself out of that walled garden. It was just as well (for me) - I can't justify spending that much on an iPhone X when there are better phones on the market for less money. Now I've switched most of my iCloud services too, and can enjoy the best of all worlds; i.e. Mac OS on my desktop, iOS on my iPads, and Android on my Google Pixel, with google's ever expanding services used across the board, and Alexa in the kitchen. For me it's just a cheaper and more flexible way to get the best services at the time, without having to be locked into and waiting for iCloud, and it works really well. It's liberating not being tied into hardware like that. I don't have t get excited about the HomePod because I can build a better home assistant and speaker setup without the cost, for example.

The point is that I get to choose. Life's too short to think that Apple are the only game in town.

 

[The Cappy]

No doubt a bunch of people added so they could use a HomePod, as has been suggested above.

 

[toph2toast]

Came here with the same thought. Definitely partially due to people buying HomePods and starting their free trial.

I don't think those using the free trial are included. Eddy Cue mentioned there are 38 million paying subscribers, while another 8 are on the free trial right now.

 

[adamjackson]

You can't discount the 1st party advantage Apple has when you open Music on your iOS device and it prompts you to pay $10 right now w/ a credit card on file to access every song ever made.

BUT, like the App Store growth, I hope that Eddie isn't given bonuses JUST on growth. I us Apple Music but fully realize that Spotify has a far better social element, dynamic playlists, better curation and overall helps me discover more music than Apple...which seems to always just want to play Hip hop for me in the "For You" section. I think Spotify has the better product with the only short coming being that you can't access Spotify from AppleTV, HomePod or Siri in a native way.

Apple's growth should not be confused with being the better product. I hope Apple continues to improve despite these numbers.

 

[Chupa Chupa]

Apple Music executive and record industry mogul Jimmy Iovine recently said streaming music services are "not making any money" due to a lack of margins, suggesting that a standard $9.99 per month subscription is not profitable.

Begs the question - what is Apple Music to Apple: a loss leader for hardware or is this 1900s Robber Barron tactics waiting to eclipse Spotify and then gradually raise prices like the cliche frog in the slowly heated water? Apple is not the kind of company anymore to take a hit on any aspect of it's business. I mean it doesn't even include a .99 USB-C to USB dongle in it's $2400+ 15" MBPs.

iTunes music WAS a loss leader for iPods and was a fantastic model obviously. But iPods don't exist anymore really. iPhones have apps that let users use any music service they want. It's not like when iTunes was pretty much the only game in town. I fail to really see Apple's end game here other than gradually raising prices to $19.99/individual or $25 for "family." I wonder if the marketplace will support that kind of pricing.

 

[WWPD]

Apple Music has gotten much better at finding new music I like, just remember to love songs that you enjoy. The New Music mix actually plays mostly songs I might be interested in and I've discovered many new artists.

 

[oneMadRssn]

Spotify is in for a bad time.

I disagree. We don't know enough to say whether this is bad or good for Spotify.

If most Apple Music subscribers are first-time music streaming subscription customers, this is good for Spotify. Apple has done the hard work of convincing someone to pay monthly for music streaming. In theory then going forward, all Spotify has to is convert more people from AM to Spotify than Apple converts from Spotify to AM. They can do this either by being lower cost, offering a better app, or having better playlists/algorithms.

If most of Apply Music subscribers are being converted from Spotify or Tidal or whatever, then this is bad for Spotify.

Considering Spotify's numbers are also growing, I would wager the situation is the former and not the latter. Thus, the whole industry is growing, and this is good news for Spotify.

 

[citysnaps]

You can't discount the 1st party advantage Apple has when you open Music on your iOS device and it prompts you to pay $10 right now w/ a credit card on file to access every song ever made.

BUT, like the App Store growth, I hope that Eddie isn't given bonuses JUST on growth. I us Apple Music but fully realize that Spotify has a far better social element, dynamic playlists, better curation and overall helps me discover more music than Apple...which seems to always just want to play Hip hop for me in the "For You" section. I think Spotify has the better product with the only short coming being that you can't access Spotify from AppleTV, HomePod or Siri in a native way.

Apple's growth should not be confused with being the better product. I hope Apple continues to improve despite these numbers.

"You can't discount the 1st party advantage Apple has when you open Music on your iOS device and it prompts you to pay $10 right now w/ a credit card on file to access every song ever made."

Or better yet, $8.25/month if you sign up for a year at $99. Which then auto-renews at that rate afterwards.

 

[suns93]

I'm curious: how is music streaming subscriptions not profitable at $9.99/mo but Netflix is ($7.99/$10.99/$13.99 tiers)? https://www.forbes.com/sites/danafe...-in-2017-exceeds-11b-in-revenue/#70d77d4c88eb

Netflix even has the added burden of creating expensive original content.

Does the music industry truly have that many more "middle-men" that need to get paid that film/tv doesn't?

Anecdotally, I could justify having only so many $10/mo subscriptions. They add up quick. So when it came to cutting subs, it was very easy to cut the music. The utility gained over free radio (OTA and internet) is quite minimal for me personally, vs. going from a tv/film sub to free OTA tv channels plus youtube or whatever. Perhaps my moral objection to pirating content online is contributing here. More so I think I just find commercials so much more jarring when watching tv/film vs. listening to music (immersed in a story vs. background sound). Also, I have hundreds of hours of music that I own that I will happily re-listen to again and again whereas you can only re-watch a dvd so many times.

For music subscribers (AM or Spotify [or I guess another service I'm not aware of but please include the monthly cost]), let me know your top 3 reasons that you think justifies the $10/mo cost. Maybe I'm missing something here.

 

[oneMadRssn]

Begs the question - what is Apple Music to Apple: a loss leader for hardware or is this 1900s Robber Barron tactics waiting to eclipse Spotify and then gradually raise prices like the cliche frog in the slowly heated water? Apple is not the kind of company anymore to take a hit on any aspect of it's business. I mean it doesn't even include a .99 USB-C to USB dongle in it's $2400+ 15" MBPs.

I don't think those two options are mutually exclusive and it can be both. It is a loss leader today meant to drive hardware sales, but they plan to jack up the rates as soon as the competition is sufficiently dominated.

This is why I really don't get all the Spotify/Pandora/etc haters out here on this forum. Do they really want to pay $24.99/month for streaming? Because that is what it's going to be if Apple gets a pseudo-monopoly on music streaming.

Honestly, I don't see a difference between that time in the 90s when Microsoft bundled Internet Explorer with Windows to drive Netscape out of business and today when Apple bundles Apple Music with iOS to drive Spotify out of business. Both seem qually bad.

 

[thenffc]

Apples always offering free 1 month to sign up, that boosts these figures - I tried it free this month to see if it had improved as I'm quite interested in a HomePod. It hasn't. Spotify is much better IMO. No HomePod for me

 

[BigJohno]

Spotify is in for a bad time.

If they dump iTunes and create a new app designed around their music service they are.

I'll be on Spotify for the foreseeable future. They have a deal with Capitol One and discount your subscription 5 dollars a month. A pretty good deal since I have one of those credit cards.

 

[kirky29]

I prefer Apple music and was a subscriber but their android app is terrible. My girlfriend shares my music account so I moved to Spotify. Would happily go back if she had an iPhone or the android apple music app was vastly improved.

Still not as bad as iTunes used to be on Windows XP / vista back in the day!

 

[mtneer]

38 million PAYING members. Cue also said there are currently over 8 million ppl who are in the 3 month trial right now.

It depends on how Apple accounts for these "free" trials. They may count them as "paying" members since they have their credit card on file; and internally they just apply an fee-equivalent "credit" to the user in order to maintain the illusion of being "free".

 

[oneMadRssn]

I'm curious: how is music streaming subscriptions not profitable at $9.99/mo but Netflix is ($7.99/$10.99/$13.99 tiers)? https://www.forbes.com/sites/danafe...-in-2017-exceeds-11b-in-revenue/#70d77d4c88eb

Netflix even has the added burden of creating expensive original content.

Does the music industry truly have that many more "middle-men" that need to get paid that film/tv doesn't?

Anecdotally, I could justify having only so many $10/mo subscriptions. They add up quick. So when it came to cutting subs, it was very easy to cut the music. The utility gained over free radio (OTA and internet) is quite minimal for me personally, vs. going from a tv/film sub to free OTA tv channels plus youtube or whatever. Perhaps my moral objection to pirating content online is contributing here. More so I think I just find commercials so much more jarring when watching tv/film vs. listening to music (immersed in a story vs. background sound). Also, I have hundreds of hours of music that I own that I will happily re-listen to again and again whereas you can only re-watch a dvd so many times.

For music subscribers (AM or Spotify [or I guess another service I'm not aware of but please include the monthly cost]), let me know your top 3 reasons that you think justifies the $10/mo cost. Maybe I'm missing something here.

Spotify family is $15/month for 6 users. That works out to $2.50/month per user. With my family, each person on the plan Venmos me $35 every August to cover the year plus sales tax.

We can debate the morals of counting parents, siblings, aunts, uncles, cousins, and in-laws that don't actually live with you as "family." However, I note that Spotify does nothing to verify the living arrangements. You just get the family plan, add 5 additional usernames or email them links to "join" the plan, and that's it. A ton easier than family sharing on Apple.

At less than $3/month, it's pretty easy to justify.