Fro all your music addicts out there we prepared a treat discussing – Apple Music vs Pandora vs Spotify vs iHeartRadio & More: the best music streaming service right now! So, stay tuned!
The introduction of online music streaming services revolutionized the way people listen to music making it more accessible and, what’s more important, more portable. The pioneers of this segment were internet streaming services, such as Pandora Media Inc (NYSE:P), but over the years more and more companies appeared, which managed to shape the industry. One of the leaders in the segment is Spotify, founded in 2008, which allowed users to have access to entire playlists, as well as save songs for offline listening, in exchange for a fee. In the last couple of years, tech giants like Apple Inc. (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc (NASDAQ:GOOGL) also jumped in the field, launching their own streaming services. According to the Recording Industry Association of America (RIAA), industry revenue from paid subscriptions in the US surged to $1.22 billion in 2015 from $800 million a year ago.
Streaming has actually managed to disrupt the music industry and while for users it had a positive effect, for the music industry streaming resulted in a drop of revenue. Even though the popularity of streaming has increased, it has dragged down the sales of physical albums, as well as the sales of downloaded albums and singles. Due to the fact that streaming services pay lower royalties, music industry is now earning less than a couple of years ago. However, the future seems to look bright as global music spending surged by 41.8% to $4.07 billion in 2015 and is expected to reach $11.06 billion in 2020, according to PwC. In this way, last year Universal Music Group managed to generate over $1.0 billion in revenue from streaming, versus $375 million a year earlier. Streaming has led to labels to change their businesses and rely more on social media to drive more revenues.
One bright spot here is vinyl, which recently has started to come back and has been gaining traction due to its nostalgic sound quality that can’t be compared to digital recordings. For example, in 2015 U.S. LP sales amounted to $416 million, according to RIAA, compared to just $14 million a decade ago. By comparison CD sales slid $1.50 billion from $10.52 billion in the same time frame.
Another industry that has been negatively affected by the new technology is the traditional AM/FM radio. Earlier this year, it has been announced that Norway would be the first country to shut down its FM Network and will switch to digital radio and other countries are likely to follow suit. Even though broadcasting via digital radio won’t be much different from analog in terms of content, with time we can see its popularity limited, since even cars currently come with technology allowing to connect to Spotify or other streaming services. With technology allowing cars to become autonomous advancing fast, there is a possibility that in the near future that in-car radio demand will decline further as people will be able to watch videos on the move. According to an Edison Research study last year, the number of people that don’t have a radio in their house went up to 21% from 4% in 2008, while the number of people having one to three radios inched down by 2.0 percentage points to 63%. By comparison, 57% of people listened to online radio in the previous month, up from 53% in 2015 and from 21% in 2006.
Having said that, let’s take a closer look at the best music streaming service right now!