Apple Music Now Has 36 Million Subscribers, Could Eclipse Spotify in United States This Year – Mac Rumors

Apple Music now has 36 million paying subscribers around the world, an increase from well over 30 million reported last September.

Apple confirmed the updated total to The Wall Street Journal, which today reported that Apple Music is growing at a faster pace than Spotify in the United States, and could soon eclipse the service in popularity in the country.

I think it’s only a matter of time. Then as Spotify declines, the major labels will dump the company in an IPO, or sell it to some private equity firm.

What’s worth pointing out is that Apple doesn’t need to make a profit on this. They make money from selling iPhones (and other products); Spotify only has one product. And Apple has ambitions that go beyond Spotify’s, regarding video content, which Spotify may not be able to emulate.

Also note that Apple Music is available in many more countries than Spotify. Spotify has a presence in 62 countries, and Apple Music is present in 117 countries, notably including India and China, where Spotify is absent.

As streaming takes over from buying music, what’s the endgame? If Apple rolls in a major video offering – either as part of the Apple Music service, or as an add-on – then will Spotify be bought out by, say, Netflix? Amazon already has both, and there probably won’t be room for more than two or three players in that market.

Source: Apple Music Now Has 36 Million Subscribers, Could Eclipse Spotify in United States This Year – Mac Rumors

12 thoughts on “Apple Music Now Has 36 Million Subscribers, Could Eclipse Spotify in United States This Year – Mac Rumors

  1. Kirk,

    Is this really Kirk, the Kirk that I read and listen to on podcasts is not this naive, Spotify is free and has a better GUI and has better music discovery and the numbers referenced in that article are skewed if you take the time to research them.

    Also Spotify is going public this year.

    And how in the heck do you believe Apple does not make a profit off their services, their long term stock price will be dependent on making a higher percentage of income from their services.

    This is why the AppleTV/Homepod does not offer Spotify/Tunein and offers very little if anything in terms of apps that compete with Apple Music.

    • “Free” does not mean it will have long term success. It makes less from ads than subscribers.

      Personally, I find the GUI unusable, and hardly anyone cares about discovery.

      And Apple’s money comes from the iPhone, and other hardware. As I say, they can afford to play the long game; they don’t need to make a profit on music.

  2. Until we reach peak smartphone, which is why Apple feels the pressure to increase the services percentage bar on that profits graph.

    GUI is unusable in your personal opinion but millions have already spoken and without the advantage of an Iphone closed ecosystem.

    And as a journalist you should have known that Spotify is about to go public this year.

    And it amazes me that you consider the GUI unusable, care to expand on what is so difficult about clicking the album and clicking the song you want played?

    • As a journalist, I am well aware that Spotify is perhaps planning a stealth IPO; ie, listing shares without a real IPO. Because they’re afraid that they may not be valued as much as they hope.

      As for the interface, I find it incredibly difficult to read white text on a black background, as do many people. The rest of the GUI means nothing to me if I can’t read text.

      And what’s so difficult about clicking an album or a song in iTunes or the iOS Music app?

    • And regarding the “closed ecosystem,” it’s no more closed than Android. I’m not saying – and I don’t think you’re saying – that there shouldn’t be both (and even more; competition is good).

  3. With “closed” what I meant is Apple has the advantage with selling hundreds of millions of Iphones of tying people to Apple Music, Spotify does not have that hardware advantage.

    There are pros and cons to how Spotify is rolling out their IPO, time will tell whether they made the best choice for their company but it will be listed on the NYSE for anyone to buy, that is going public so your first statement about larger companies dumping them in an IPO was factually wrong.

    And not perhaps: The Swedish music-streaming company filed confidential documents in late December with the Securities and Exchange Commission to list its stock on the New York Stock Exchange.

    By the way, the direct IPO listing method might actually benefit the average investor who does not have access to a traditional ipo before it is actually public, the traditional way allows big money people to for example buy Google stock at 50/60, while the cheapest the public could buy GOOG was near 100.

    I could try Apple Music again but here is the issue: I don’t want to sync or upload any songs from my Itunes account to the itunes music cloud library. Now in the Preferences – general section the only option is to “show Apple Music features”, I will have to sign up with Apple Music to see the option of uploading music to Icloud music library.

    But once I sign up with Apple Music, won’t it start uploading music automatically or does it give you the option to uncheck song library uploads before the process begins?

    Because as you have documented many times Icloud screws up your album art and has other glitches, hey Kurt if my tone reads negative, my apologies, I respect your views, it just seems that your usual sense of journalism is off with this post, I could be wrong.

    • You don’t have to sync or upload anything. You can use Apple Music without using iCloud Music Library; that’s what I do. I don’t want to mix my music with Apple’s stuff, and have my metadata screwed up again.

      As for the IPO, the major labels have a huge amount of equity in Spotify, and people in the industry have suggested that they may start divesting once they can get some profit from an IPO (or whatever the share issue will be).

  4. Thanks, do you remember when you signed up for Apple Music, in your case was the option to deselect upload music to Icloud library present before you signed up, if the answer is no then I can safely try it once again, if the answer is yes then for some reason they changed things and I would be taking the chance of Apple possibly uploading automatically.

  5. In 2013 Spotify lost $55.9M, in 2014 it lost $162m, in 2015 it lost $173m.

    In 2016 they raised $1 billion in convertible debt based on the promise that new investors would get a discount on shares when IPO was filed – in other words, they NEEDED to file an IPO regardless of whether or not it was prudent, simply to reward investors it desperately needed to fund it.

    Spotify losses in 2016 were $581.4 million on revenues of $3.064 billion.

    Also: at a time when it’s reported that Apple Music is increasing to a lead in the USA, in 2016 Spotify derived 39.8% of its revenue from there – so it’s bound to report worse earnings (unless the market for streamed music magically and exponentially has increased).

    As of a year ago, Spotify carried a negative net worth of $242.4 m, versus a positive net worth of $238 m the year before.

    Its free tier makes it popular, but its unprofitability is driving itself into a ditch. The company has never made a profit. And yet, based on the investments made into it (some of which were flipped to Chinese company tencent for a profit) the company is making itself too big to be acquired by another company, with a valuation now upwards of (an insane) $19 billlion.

    • Indeed, it seems that valuation is based on an assumption that the company will suddenly, and miraculously, become profitable, and their roughly $5 billion in revenue will become profit. The thing is, they pay somewhere around 70% of that revenue to rights holders, which is why the major labels aren’t too worried. Even if Spotify is losing money, they’re making money.

  6. A key question, is Spotify paying more/less/the same as Apple Music and other streaming sites to the labels?

    What are the U.S. and world subscriber numbers for Spotify, Apple Music etc.?

    You guys do realize that many companies debut on Wall Street with zero profits. Amazon is in a totally different realm but they went years losing money or breaking even or making 500 million profit on 20 billion in revenues. I believe for Amazon shipping is their biggest costs.

    The point is you don’t make investment decisions purely on current profit margins.

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