Why Apple is shutting Beats Music
On Friday, Apple announced its plans to shut down Beats Music at the end of the month. When the tech giant acquired the Beats brand over a year and a half ago–in a $3 billion deal that included its massively profitable headphone line, a deal that helped make Dr. Dre the highest paid man in hip-hop–it was widely assumed that Apple wanted to use its streaming platform as the foundation for a run at Spotify, which has dominated the market for streaming since its emergence as the default method for young music fans to consume music.
Those predictions paid off at the end of June with the launch of Apple Music. Since then, Apple has kept Beats Music in a sort of zombie state, apparently just long enough to release an Apple Music app for Google’s Android platform, which it did just days before announcing Beats’ shutdown.
In October, Apple announced that Apple Music had already brought in 6.5 million paying users–a third of the paying user base that Spotify boasts. Millions more are still using the free introductory three-month trial membership, and Apple reported those numbers in the first month that day-one subscribers’ trials had run out. Presumably, some portion of those millions were just people who had forgotten to cancel their subscriptions before it showed up on their credit card bills. (Full disclosure: I’m one of them.)
Beats Music never came close to those numbers. As of last December, it claimed just a little more than 300,000 U.S. subscribers. But where Spotify was first to the on-demand streaming game and Tidal has defined itself by its star-studded board and ability to secure A-list exclusives, Beats Music had a more low-key charm. Its staff-curated playlists were sorted by quirkily specific moods and musical criteria, and they felt more like what a record-geek friend would send you than the bland genre playlists created by automatons and algorithms on other services.
Beats Music will be mourned by a very tiny segment of a very large and ever-growing market. In the big picture, its passing is important because this is the moment when Apple Music’s training wheels finally come off. Offering software updates that integrated Apple Music into iOS’s default music app, plus the free-trial deal, made it easy for Apple to snatch up a good chunk of people who use their own products, but Android controls over 80 percent of the smartphone market, which is basically the same thing as the music-player market these days, and Apple doesn’t have any ability there to push their new product in the same way.
Unlike iOS users, Android users will be choosing between streaming’s Big Three from something like a flattened field. When we see how Apple Music performs in a fair fight, we’ll reevaluate Apple’s claims that it is hot on Spotify’s heels.
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