Spotify Adds 10M To Paying Subscribers For 50M Total In February
In the world of smartphones and computers, Apple is a market leader, but when it comes to music streaming, Apple Music plays only second fiddle to Spotify. Om Thursday, Spotify reached another milestone by hitting 50 million paying subscribers.
MacRumors reports that Spotify added 10 million paying members in five months since as of September, the music streaming service has 40 million paying subscribers. Apple Music is actually also growing, but at a slower pace than Spotify.
Slower Growth Rate
Apple Music had 20 million paying subscribers as of December. At the pace it is adding paying subscribers, it should be around 22 million now. In June 2016, Apple Music had 15 million subscribers which grew to 17 million in September. The rivalry between Apple Music and Spotify intensified in August when Spotify alleged began sanctioning artists who agreed to Apple’s tactics.
Apple Music lured new paying customers which led to several clashes with Spotify in 2016. Spotify “got even” by displaying less prominently the music of artists who agreed to Apple Music’s exclusive deals and offering them fewer opportunities to promote their songs. Spotify had denied the accusation but the relationship between the two music streaming giants turned for the worse with the increase in Apple Music’s popularity.
New Features & Subscription Models
To further add paying subscribers, Apple Music and Spotify are trying out new subscription models and features. Apple plans to utilize original TV programming to attract more subscribers and debut programs such as Carpool Karaoke. Spotify aims to attract audiophiles by trying out a lossless version of streaming music.
The good numbers could help Spotify gain some goodwill from major music labels pushing the music streaming service to restrict free and ad-supported listening. To reach and retain its market leadership, Spotify is paying a lot for its music licenses and adding customers, resulting in the company – which would eventually go public - not yet turning a profit, Variety points out.
In 2016, Spotify raised $1 billion in debt financing, but the conditions raised significantly the cost of the loan he longer Spotify issues an initial public offering. Apple Music’s mother company, Apple, meanwhile, is awash with cash.