What it is: Apple Music is Apple’s streaming audio service.
In case you haven’t noticed something, there’s a growing trend in the computer industry. In the old days, you bought software in a box. Then the publishers had to release new versions every few years in hopes of getting you to upgrade consistently. The latest trend in software is software as a service, otherwise known as a subscription.
The idea behind software subscriptions is that you pay a low price monthly and get access to the latest version of the software as long as you continue paying your subscription. That’s how Adobe switched from selling boxed copies of software to turning their entire Adobe Creative Suite into a subscription service. In the short-term, subscriptions are cheaper than boxed software. In the long-term, they’re more expensive but in return you always have the latest version.
For companies, software subscriptions are far more lucrative in the long run and provide a steady and predictable revenue stream. That’s why everyone is flocking towards subscription services.
That’s where Apple got caught flat-footed. After record stores went out of business trying to sell CDs, Apple dominated the music industry by selling audio digital downloads through iTunes so people could play their music through iPods. That model of selling music as digital files worked well right up until the time it didn’t. That’s when streaming audio services like Pandora and Spotify appeared and slowly eroded the iTunes business model. Rather than buy music, it was cheaper to subscribe to it. Not only did this give you access to more music, but it was also cheaper in the short term.
Apple feebly tried to compete with minor updates to iTunes along with their own iTunes Radio that would allow you to create your own music channels based on the type of songs you wanted to hear. Then iTunes would play similar songs based on an algorithm. Such algorithms proved wildly unpredictable, which resulted in users having a less than ideal experience with iTunes Radio.
After seeing sinking sales of digital music through iTunes and declining sales of iPods since every smartphone and tablet essentially had an iPod built-in, Apple spent $3 billion to buy Beats Music. Beats not only had a streaming audio service, but they had something more important: a relationship with artists in the music industry. Now Apple has rebranded Beats into Apple Music.
Apple Music puts the emphasis back on music. While iTunes and the iPod were great technological triumphs to get people to listen to music, Apple needed something that technology couldn’t provide, which was satisfying the needs of millions of music lovers all over the world. That’s why Apple Music is taking a three-pronged solution.
First, Apple Music is a streaming audio service that offers a free, three-month trial period. With prices matching their rivals (Pandora and Spotify), Apple Music is roughly equal to existing streaming audio services.
Second, Apple Music offers Beats 1, a 24/7 free radio station run by top-notch DJs around the world who hand-pick songs that they think people will like. Having a music fanatic choose songs from known and unknown artists is less predictable than a computer algorithm, but more likely to match current trends in music in ways that computer algorithms could never match. In the old days, radio stations used to have DJs pick songs they thought their listeners wanted to hear, which resulted in unique musical offerings from one DJ to another. Beats 1 is now trying to duplicate that on a worldwide scale. The idea is that once you hear Beats 1, you’ll be more likely to sign up for a subscription to Apple Music or buy music from iTunes.
Third, Apple Music offers a social network so artists and fans can connect. Once again the goal is to get you to buy something, but by offering you exclusive content and giving you an easy way to connect with your favorite artists, Apple Music hopes to entice more people to rely on Apple Music just like people in the old days used to rely on iTunes and iPods.
Apple Music may not bring Apple to its dominant position it had in the iPod era, but it will definitely bring them back into the forefront of music trends with a streaming service that won’t embarrass themselves like their early attempts at iTunes Radio did.
The real key isn’t technology but in relying on old fashion human knowledge of music trends in the form of DJs and curated playlists from other music experts to make it easy to find new music and follow new artists. For that reason, Apple Music will likely help people explore new music that they may never have heard or thought about before.
As long as Apple Music works from a technology standpoint, it will likely succeed in one form or another as a music industry leader. It may not be number one, but it doesn’t have to be. It just has to reverse the declining music sales of iTunes and iPods that are gone for good. In our lifetime, we’ve gone from vinyl records to CDs to digital audio downloads to streaming audio services. If you don’t think change can happen and make your current business model obsolete overnight, you haven’t been paying attention to all the evidence right before your eyes. Just ask Apple how they went from a music leader with iTunes and iPods to an also-ran almost overnight.
With Apple Music, Apple is back in the music industry once more.