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Business News Digital
Apple Music passes thirteen million subscribers
By Andy Malt | Published on Wednesday 27 April 2016
Apple Music has now passed thirteen million users, Apple CEO Tim Cook said yesterday. The announcement of an addition of two million subscribers to its music streaming service since February came as the company announced its first decline in revenues since 2003.
The music service, as part of a collection of services the company now offers, was held up as a positive in the quarterly earnings announcement. While overall revenues are down, service revenues are up 20%, said Cook.
Launched last June, Apple Music had reached eleven million subscribers by August, according to Apple exec Eddy Cue at the time. That figure had reportedly dropped to ten million in January, presumably due to people who signed up for the three-month trial at launch choosing not to begin paying for it.
With the service back into growth again, that issue would seem to have stabilised. However, with the service pre-loaded on hundreds of millions of iPhones, it could be said that Apple appears to be struggling to convince most people to even sign up for a free trial.
Main rival Spotify is growing at a faster rate still, having added ten million paying subscribers to its service between June 2015 and March this year. And, although still much smaller, Tidal is also increasing the rate at which it signs up users. It recently revealed that it had pulled in two million users between November 2015 and March.
The majority of Tidal’s new subscribers are likely to have come to the service this year, thanks to the Rihanna and Kanye West exclusives, which could mean it is getting closer to Apple Music’s average of roughly one million new users per month. Of course, playing the exclusives game, especially when those are only temporary, probably means a higher churn rate of free trial users who lapse, but it’s still closer to Apple Music’s growth than would perhaps have been expected.
Nevertheless, Apple Music is still the second biggest on-demand subscription streaming service in the world, and it’s growing. And like all Apple content services, it has the benefit of not needing to become particularly profitable, unlike rivals, because its key reason for existing is to sell hardware. That said, if it becomes a trend that Apple’s hardware revenues continue to fall and service revenues continue rise, that could all change.
