Why should you care about Streaming Companies?
In recent years we have seen the music industry forced into some of it’s most extreme and extensive transformations. The advent of modern technology has brought on numerous and apparently endless shifts in the ways in which we purchase, share and consume music. The invention of the MP3 download signalled the beginning of the end for the days of CD sales reaching any significant numbers. Piracy, illegal downloading and sharing of MP3’s then caused a once $40billion industry to shrink by more than half. In essence, over the last ten years or so, the Music Industry has been no stranger to having a proverbial knife held firmly at its throat.
After that brief but bleak overview of recent history it might be difficult to envisage a return to the days of an affluent, dynamic music industry. Enter Streaming – When companies like Spotify, Pandora, Last FM, Deezer and Grooveshark began to upload catalogues upon catalogues of musical material onto desktop and online applications for people to stream in real time, often free of charge, many commentators predicted the end of a dying industry, unable to show the necessary pragmatism during the volcanic eruption that still exists in the development in internet technologies.
There was uproar from the labels, the chief executives, and many artists, most notably Radiohead’s Thom Yorke, who is still unmoved, infamously labelling Spotify “the last desperate fart of a dying corpse” in just October last year, despite recent improvements and apparent signals that increases in streaming are clearly running parallel with a steady decline in piracy rates.
Spotify currently has 24 million active users, and counting, with 6 million of those paying a subscription, Deezer is currently catering to 12 million users, with 5 million paying customers, a far better subscription turnover rate than Spotify. In January this year (2014), Beats launched a service which is sure to rival the big players, a mouth watering team including Luke Wood, Ian Rogers, and Trent Reznor join chairman Jimmy Iovine and of course Dr. Dre in pioneering a service specialising in human curation.
Despite a turbulent entrance onto the scene due to issues surrounding legality, legitimacy and how on earth artists would be getting paid it seems as though Streaming is a paradigm in which some hugely influential figures in the industry see some potential in.
Convergence and bundling are major factors that are going to influence the next phases of its development, how are these applications going to develop and become more practical? It could be said that a start has been made in most providers issuing mobile applications for paying users which means they can make their playlists and catalogues available offline, eliminating the painful stops resulting from poor connection speeds. Who are these companies going to bundle with? Spotify has already teamed up with Vodafone, offering Spotify Premium as an option to customers who sign up to 4G ready contracts. Access to 24 million customers when the country is fully adaptive to 4G technologies draws an optimistic picture for that particular firm, who’s CEO Daniel EK was recently voted number 25 in the ‘2014 Billboard power 100’.
So it looks like Streaming is here to stay, for the moment at least.