Many have waited for the day Apple, with its juggernaut marketing muscle and insatiable appetite to create a market out of thin air, got behind subscription music. That day–many posited–streaming music would finally come of age because for the first time everyday people would be aware of the product.
In the 13 years since Rhapsody introduced the first licensed subscription service, the product has been on the fringes of the mainstream. Even today, less than 20 million people around the world pay for an on-demand music service.
And why the dread? Many in the business who have been here since the beginning felt that the day Apple came into the market it would be game over for all the existing companies. Based on its power, many believe that Apple will take all the oxygen out of the market and there would be no room for other players in the field.
Based on the WWDC’s presentation, current streaming players don’t have much to worry about. At least not for now. The product was somewhat all over the place. It featured:
A reboot of Beats Music’s streaming service feature Apple Music branding;
Apple Music Connect, the way that artists can directly communicate with fans–if artists choose to opt in and talk to fans in the Apple ecosystem (good luck with that one);
Beats 1, a 24-hour radio station, featuring former BBC 1 DJ Zane Lowe.
While there are problems with all three elements, Beats 1 is the most intriguing and confounding. In some respects, a worldwide radio station based on BBC 1 is a bold move. Apple is smart in that it has a captive audience on the phone, and it potentially could gain a sizable audience. But on the other hand, it seems at odds with the value proposition of streaming music. It’s like Apple is saying: hey music lovers, we have millions of songs that you can listen to wherever you are, but we’ll just feature these 150 a day in our service. Enjoy!
Look, streaming services are closely controlled by restrictive licenses from the major labels. There’s very little innovation that a company can create in term of features, offerings or pricing. Because of this, services must utilize content programming strategies to differentiate. In essence, the content programming approach serves as the soul of the company. By focusing on Beats 1, Apple is stating that its soul is about the tightly controlled experience. Sure, Apple will continue the Beats Music blueprint of having music experts create playlists for genre and mood, but that experience was extremely thin and needed improvements to function correctly. And now Apple is adding a broadcast style product.
So why is this approach a mistake?
1) It can’t cover the range of tastes
Sure, a flagship radio station from the largest retailer of music in the world makes sense, but for how many people? Ten percent? Twenty percent? When I was part of the team that managed content programming at Rhapsody we operated with this ethos: program to the taste spectrum of our listeners. In other words, we looked at the data and created radio stations and playlists for whatever people were listening to. More indie rock? No problem. More easy listening? Sure we could do that. More Beyoncé (always with the Beyoncé)? We would deliver more of that. A single worldwide station seems like a crappy way to service that model. And let’s just say that Apple is super successful and replicates Beats 1 and creates a shitload of stations. That’d be great. But at best it ends up matching exactly what Sirius XM does pretty well. In other words, it just refines broadcast radio.
2) It won’t cover the catalog
At best, Beats 1 will be able to play about 150 songs a day. With a catalog of music over 30 million, even the most adventurous programming in the world will lead to exposing a laughingly small amount of music to its customers. While the idea that a music fan wants 30 million songs is an absurd notion, it would seem that Apple can do better than exposing .0001 percent of the catalog it has licensed.
3) It’s an artifact of the past
Many of us of a certain age grew up with great radio and understand its power and allure. And to my mind, that’s what the geniuses at Apple Music are focusing on: their own experiences. But the world has truly changed. Music fans have access to more music than ever. Because of this, the behavior of listeners–in particular the next generation–has irrevocably changed. Despite the conclusions from Nielsen’s questionable survey about radio discovery from last year, I contend that the next generation isn’t listening to radio. Oh sure, maybe they flip through the five channels programmed in the car to hear the same crap. But then they’ll plug in the phone and listen the way they want on Spotify, Pandora, Slacker, Songza, Beats, Soundcloud or the 35 or so other options at their disposal.
4) There are many more important things it should be doing
Building streaming services is hard work. There will still be many problems that Apple will need to address. The Beats service itself needs significant improvements. Just like Ping, Apple Music Connect will be dead on arrival unless the company puts significant resources towards its development. Apple Music has much work to do to create real value for customers. Throwing resources towards a single radio station seems kinda stupid considering the way the world has changed.
Jimmy Iovine said in his off-kilter presentation that internet radio isn’t truly radio, but rather just playlists masquerading as radio. The implied point was that Apple was gonna reinvent radio by putting all the trust in a few tastemakers. But does that make sense in a world of infinite choice and unlimited possibilities?