June 11, 2015

Apple Music: The World’s Biggest Paid Music Service

This comparative chart appeared in one of The Wall Street Journals articles this week:

The Wall Street Journal's Chart

We’ve seen products create, rejuvenate, and expand small, crowded markets before, but I’m certainly not claiming this about AM at this point. It is also definitely true that Apple Music currently has zero users, free or paid. But looking at the users row in this chart can be very misleading. Here’s Jan Dawson on Twitter:

>400m people with app auto installed plus 3 months free should add up to lots of paying users a few months from now for Apple Music

In this crowded business, Apple also owns one of the platforms on which these services are competing.

Given 400 million iOS users and the day old news of Spotify reaching 20 million paid subscribers, roughly 1 in 20 iOS users would have to renew their 3-month trial for Apple Music to become the biggest music subscription service in the world.

Roughly, but probably not more: this disregards the fact Apple Music will also be available on Android, that 400 million is actually a conservative estimate for the number of active iOS users, and that Spotify — barring any retaliative moves — is bound to lose some of its paying customers to Apple. If we take those into account, and despite Apple Music launching in only” one hundred countries, a conversion rate of 3-4% is going to be just enough.

I wouldn’t be surprised to see this milestone celebrated — surely not outwardly — but I sure do hope Apple is aiming for much more than just the number one spot.

So, the real headline a few months from now would be Apple not having become the biggest paid music service in the world.

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