Apple changing the tune…a bit too late?
The expiration of the free trial is scheduled for September 30, but according to a US survey, the majority of the 11 million users of the service do not intend to renew their subscription.
The trial period is still on, but it seems that Apple Music, the streaming platform launched in June by the Cupertino giant, has not conquered the Americans. According to a survey run by MusicWatch, out of five thousand interviewees, 61% have disabled the automatic renewal to avoid paying the subscription at the end of the free trial period, on September 30. About two-thirds (64%) of those who are still using the service, however, said they would consider paying for Apple’s streaming service in the future.
Launched on June 30, Apple Music has reached 11 million users a couple of weeks ago, according to a statement by the company’s senior VP Eddy Cue. According to the survey, 11% of users of iOS, the operating system of the iPhone and iPad, have tuned in to Apple’s music stream. In comparison, 40% of iOS users download paid music on iTunes, so the appeal of Apple Music could be higher, says Russ Crupnick, managing partner of MusicWatch, and « this is the disadvantage of arriving on a market where there are already very good services available « .
Among these, the most successful is Spotify, which has 20 million paying subscribers and 50 million users who have chosen the free version, funded by advertising. According to the survey, to use Apple Music are 28% of those who have subscribed to Spotify, and only 11% of those who enjoy the free version of the rival platform.
But the music war is also moving to Washington, where Spotify challenges Apple before the US Congress and lobbying to raise suspicions of antitrust misbehavior from Cupertino, claiming that Apple is taking advantage of its power to close incorrect agreements with record companies that threaten competition. Spotify has addressed directly to the Chairman of the Justice Committee, Bob Goodlatte, and the number one of the Antitrust Commission of the Congress, Tim Marino.
Spotify is thus trying to capitalize on the battle started, and won, by the American authorities on ebook prices. Apple lost a recent appeal, but it is not yet clear whether the battle will continue, as in Cupertino they continue to deny the allegations.
Strong lobbying Spotify highlights the rivalry between the two giants to the music industry: a growing sector where Apple aims to establish itself, as it did on the smartphone market. The lobbying expenditures show how heated are the hostilities/ Apple – reports the American press – has spent $ 1.2 million in the first three months of the year to defend their interests in Washington, with priority on the issues of copyright.
Meanwhile, after the sarcastic welcome the new Apple service got from the founder of Spotify Daniel Ek on Twitter (an irreverent « Oh ok » comment, removed soon after), the Swedish company has just announced that a new round of funding of 526 million dollars has been secured. A sensational cash injection, which was announced in April and is now finalized, bringing the company’s market value to more than $ 8 billion. The group of investors includes the Swedish telecom giant TeliaSonera AB and investment funds such as as Senvest Capital, Discovery Capital Management (Canada) or Halcyon, GSV and Goldman Sachs on the US side. According to some sources, even the sovereign fund of Abu Dhabi would be part of the team. On the service side, the platform has recently introduced exclusive video and radio programs.
The war for the control of music streaming is open and the US antitrust investigation is only the first one of the battles.