"The streaming music business is one crowded jam session"Submitted by Michael Nystrom on Sat, 01/25/2014 - 14:18
An article from BusinessWeek, with a line that caught my eye.
Beats Music Joins the Crowded Streaming Music Market
By Andy Fixmer | January 23, 2014
When recording artists as diverse as Sara Bareilles and Daft Punk gather to strut their stuff at the Grammy Awards on Jan. 26, it will be a welcome diversion for an industry that’s heading into another period of upheaval. The purchase of downloadable digital music, a format that is dominated by Apple’s (AAPL) iTunes and has propped up industry sales for a decade, is winding down. Streaming tunes on mobile devices is all the rage and may soon overtake downloadable music in terms of revenue.
The streaming music business, though, is one crowded jam session. Pandora Media, Spotify, Rdio, Songza, Google Play Music All Access (GOOG), iTunes Radio, and others all vie for music lovers. The category is full of conflicting formats, pricing strategies, and features, and no dominant business strategy has emerged. Nor is music industry officialdom in love with the technology. Most ad-supported music subscription services are free (recording executives really hate free) and don’t generate industry sales. This crowd also pays what artists such as Radiohead front man Thom Yorke and Talking Heads founder David Byrne say are unfairly low royalty fees even as streaming services send out millions of songs over their server networks.
All of which begs the question: Does the world really need another music app? Beats Electronics, the company behind the popular line of high-end headphones and speakers, launched Beats Music on Jan. 21. It’s the latest combatant in the music streaming wars and the brainchild of record producer Jimmy Iovine and rapper Dr. Dre. Iovine, chairman of the Universal Music Group (VIV:FP) label Interscope Geffen A&M, is convinced Beats Music can be a standout service by being a more sophisticated music curator of the vast library of music available online. Then there’s the instant name recognition and cross-marketing opportunities that come with the edgy Beats brand. “Beats will draw a lot of attention to music services, creating a halo effect for the industry,” says Ted Cohen, managing partner with digital music consultant Tag Strategic.
Continue reading, (if you so desire): Beats Music Joins the Crowded Streaming Music Market