The Growing Music Streaming Phenomenon
By: Joseph Zapinski
Music streaming services make money one of two ways: either from making their listeners sit through ads or making their users pay for a premium subscription and get more features and no ads. There is no question that Spotify and Apple Music are both at the top of the music streaming service industry at the moment, but what makes them so great? Why are they at the top and how are they consistently turning such high profits? For starters, streaming is currently the most popular way of consuming music in the U.S. with 30 million Americans owning a paid subscription to one streaming service or another. On top of that, around streaming makes up a whopping 62% of music industry revenue now. That alone tells us that any company on the top of the list of major music streaming services is hitting it big and will only continue to grow as more and more people invest in music streaming subscriptions.
Spotify raked in $4.8 billion in 2017 and is projected to continue growing into 2018 and beyond. While that seems like a lot and it is, that still only accounts for a small fraction of the total worldwide income from music streaming. Other services like Apple Music are making a run for Spotify's top spot in the industry. In the U.S. in October 2017, Spotify had 18.2 million paid subscribers while Apple Music had 15 million, an increase from previous years that shows they are are closing the gap on Spotify who has begun to stagnate. In 2017, Apple Music added 5.2 million subscribers and Spotify 6 million. While Spotify did technically bring in more new paid users, they will have to watch their backs as Apple Music is putting up very similar numbers despite being a much newer service.
https://sharespost.com/insights/blog/spotify-financials-the-numbers-behind-a-21-billion-ipo/
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