Apple’s new music streaming has opportunities for expansion; competitive streaming services not affected by launch
According to a new research study conducted by MusicWatch, a company providing consumer research for the music industry, three quarters (77 percent) of Apple’s iOS users in the United States are aware of Apple Music, and 11 percent reported they are currently using Apple Music. That usage level is similar among consumers who purchase music from iTunes or use iTunes to manage their music collections. Among users of iTunes Radio, Apple’s earlier music streaming service, listening to Apple Music reached 18 percent. The study measured trial, awareness and use of Apple Music across a representative sample of U.S. consumers.
Among people who had tried Apple Music, 48 percent reported they are not currently using the service. More than one quarter (28 percent) of Spotify Premium customers also use Apple Music, but the draw from popular ad-supported services is more modest: Just 11 percent of Spotify Free users, and 6 percent of Pandora users, now use Apple’s offering.
“In terms of benchmarking Apple Music, 40 percent of iOS users are buying digital downloads from iTunes, suggesting trial of Apple Music could be higher,” said Russ Crupnick, managing partner of MusicWatch. “That’s the disadvantage of not being the first mover in a market where very good services currently exist.”
While it has become popular to use the term “streaming wars” to characterize the current state of the music industry, very few Apple Music users said they had stopped using their online radio, audio on-demand or video streaming services, as a result of using Apple Music. The service is potentially having some positive effects on music sales, as one-third of current Apple Music users said they had been encouraged to start buying digital tracks and albums, or to buy more, as a result of using Apple Music. Very few Apple Music users claimed to stop buying downloads altogether.
Nearly two-thirds (64 percent) of current users said that they were extremely or very likely to pay to subscribe to Apple Music after their free trials end. On the other hand, 61 percent reported that they had already turned off the auto-renewal option in their iTunes account settings.
The most popular feature on Apple Music was its “My Music” functionality, which allows listeners to manage music and create playlists. Beats 1 is being used by 30 percent of Apple Music streamers, while 27 percent are using Connect.
Methodology note: The data referenced in this press release is from the MusicWatch 2Q Report, which was released in August 2015. MusicWatch surveyed 5,000 U.S. consumers, age 13 and older; results were weighted to the U.S. population.