Apple is set to launch their long anticipated Apple Music 11am on June 30 2015, alongside iOS 8.4. Both consumers and industry insiders have waited with bated breath for the release since Apple purchased Beats Music just over a year ago. And none have been waiting more keenly than Spotify, who will face the first truly existential threat to their service.
Apple has spent a good deal of money promoting their streaming platform, which will role out to a greater fanfare than Google Play Music or Rdio ever did. However, while it is clearly well positioned to enter the market, it is still coming up against a behemoth in Spotify, which already has a large and entrenched user base. Spotify currently has 75 million users, and over 20 million paid subscribers, more than half of which came over the past six months. It has already seen off the challenge from Jay Z’s new Tidal service without breaking a sweat, although this probably has less to do with Spotify’s successes and more Tidal’s many failings.
The most obvious question is, what does Apple Music have to offer that will make people move over to them? On the surface, there is little difference with Spotify. The three month free trial has been well publicized, thanks in part to Taylor Swift’s declaration that she would be withholding her music as a result of Apple not paying artists for music listened to during the trial period. You can already get a free trial of Spotify though, albeit one with adverts, but which you don’t have to leave after three months. Apple Music is also set to come with access to 30 million songs, roughly the same as Spotify, and is to give labels, publishers, and other music owners an average of 73% of revenues globally, and 71.5% in the US. This is marginally more than Spotify, although likely not so much that anyone will consider swapping for ethical reasons. When Spotify comes to renegotiate publishing rights though, this could hit their bottom line.
The differences are largely small. Apple claims it will provide access to more exclusives from artists such as Drake, which is nice, but hardly worth going to the trouble of moving all your playlists over for. Apple will also offer a ‘family package’, allowing access for up to 6 people for $14.99, although Spotify has said it will soon match this. The main difference comes in the form of Apple’s live radio feature, called Beats 1, whereas Spotify has stations based on your favorite artists, genres, songs, playlists or albums, and the service hunts down songs which fit in with those you either up vote or down vote.
The main reason people will turn to Apple Music - and it is a pretty convincing reason - is convenience. For owners of iOS devices, who number in the hundreds of millions, the app will arrive fresh on the device tomorrow, and with a free trial there is almost no reason for them not to use it at first. With Apple’s Touch payment systems as well, setting up a subscription will be available at the press of a button.
Spotify has fought back, launching PlayStation Music streaming service in conjunction with Sony. The service is available on Sony phones and tablets, as well as the PlayStations 3 and 4. It also recently raised $400 million, so it is well positioned to deal with any competition. The real problem comes if Apple wins the fight to have Spotify get rid of their free service as they are trying to do, without which the odds may be insurmountably stacked against them.