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Beats Music signed up 28,000 people in month one, sources say
By Chris Cooke | Published on Friday 21 March 2014
The all-new super-duper Beats Music – you know, the American streaming service lovingly built from only the world’s finest binary code by Dr Dre and his mate James – signed up about 28,000 customers to its ten dollar a month subscription package during its first month in business back in January, so basically about a thousand people a day.
Or so reports Bloomberg, seemingly sourcing that stat from an investor presentation. Of course most of those 28,000 subscribers opted in before Beats forced that cringe worthy Ellen DeGeneres telly ad on the world, so you’d like to think most of them bailed as soon as the gurning talk show host became the company’s official public spokesperson.
Or probably not. Beats Music, of course, is relatively late to the streaming music party, entering a US market where Pandora and YouTube dominate, and the likes of iHeartRadio, iTunes Radio and Spotify had something of a head start. And unlike all of those competitors, Beats has opted not to offer an ad-funded freemium option, with new users forced to pay for the tunes beyond a one or three month free trial.
But the new player in the market hopes to exploit the existing popularity of the Beats brand, and its long-held celebrity alliances, with Dre and beyond, while also pushing its platform’s ‘discovery’ credentials, striking up partnerships with major retail and tel co partners, and splashing quite a lot of the finance the company has raised on mainstream marketing.
All in all, it’s a pretty good strategy, and with popular digital music exec Ian Rogers steering the ship, many in the music community are hopeful that Beats, more than any other digital player, can help take subscription-based streaming mass market. Though the flip side of that is, if Beats Music doesn’t work out, does that mean pay-to-use streaming will only ever be a niche service? Hence all the interest in the firm’s sign-up rates, even if no official figures have been released, and in many ways it’s all to soon to tell how things are really going.
According to the Bloomberg report, the 28,000 sign-ups preceded the launch of Beats Music’s high profile tie-up with tel co giant AT&T. Since that went live, the newswire reckons, some 750,000 people have now signed up to the free trials of the service, and indications so far are that conversion from trial to subscription is currently at a rather impressive 70%. Though most AT&T customers are as yet still to reach the end of their freebie time.
But still, given that Beats co-founder and Universal exec Jimmy Iovine told reporters in January that goal one for his firm’s streaming service was getting half a million paying users, the unconfirmed Bloomberg stats are looking good.
Though arguably, with a new digital service as hyped as Beats has been in the US this year, getting the first million early-adopters is the easy bit, signing up the next four million that one analyst at Boston-based Recon Analytics reckoned were required to begin building a viable stand-alone business may be more challenging. And some reckon streaming services need ten times that amount (globally) to become truly profitable ventures if the royalty rates paid out to the music companies are to be maintained.
Still, for the time being, go Beats go.
