Improving streaming services could gain more subscribers according to a recent survey* of US adults conducted by YouGov on behalf of specialist classical music streamer, Primephonic. The survey’s main findings showed dissatisfaction with all the mainstream streaming services:
- 73% cannot always easily find what they are looking for
- 85% do not frequently listen to playlists recommended by their streaming services
- 74% do not believe streaming services do an adequate job at introducing them to new music
In recent years the move away from physical music formats and downloading to streaming services has been rapid. According to the RIAA, streaming revenue in the US increased by 30% in 2018. The research shows that most Americans, a notable 52%, are not yet streaming and of those who do stream, the majority have a free subscription. Currently, only 21% of Americans have a paid streaming subscription. The US music industry could potentially increase in volume by a factor of five.
In a blog posting, Primephonic note that ‘Despite historic significant growth, it appears that the major streaming services are not yet ready to capitalize on this massive growth opportunity. Since Spotify’s US launch in 2011, the major streaming services have successfully harvested the ‘low hanging fruit’: young, digitally savvy, pop fans. Now, there is an increasing need to win over the ‘higher hanging fruit’: pickier and typically older listeners, often of niche genres. The current services available in the US market have been unsuccessful in convincing these more demanding potential subscribers to subscribe. To satisfy these more discerning music fans, streaming services will need to develop more compelling propositions, as our survey shows that Americans who do stream are already surprisingly dissatisfied with what they are offered.’
The survey went on to ask whether existing streamers would be willing to pay more than the current $9.99 market price for a streaming service that truly met their needs with 52% of currently paying subscribers answering yes. Some would even be willing to pay more than $20 a month.
How much are you willing to pay for a streaming service that truly meets your needs?
The willingness to pay more than $9.99 is even higher among fans of niche genres like classical music – two thirds of classical music fans indicate their willingness to pay more than $9.99 for a streaming service that truly meets their needs. Thus, the US streaming industry could not only grow by a factor of five in volume, it could also charge more if its products better met consumer requirements. Primephonic estimate that the US streaming market has the potential to grow by a factor of 7.
Americans who listen primarily to niche genres like jazz or classical music face a lot of issues when streaming. Often, they cannot find what they are looking for, receive uninspiring recommendations, and find the audio quality lacking. 9% of Americans, or in absolute terms, 25 million Americans, would prefer to use a streaming service that specializes in their favourite genre. Assuming a revenue per subscription of $100 per year, this would imply a $2.5 Bn market opportunity.
This is already reflected in the trend of upcoming niche streaming services like GimmeRadio (death metal), Dubstep (remixes), Primephonic (classical music) and Spinrilla (R&B).
GimmeRadio considers itself ‘The Home for Metal’: a streaming radio station hosted by selected DJs who live and breathe radio. Their app is available in the Apple App store and the Google Play Store. Subscribers love how the service takes them out of their comfort zone and allows them to experience music that they have never heard before. GimmeRadio was founded in 2017 in San Francisco and is ad free.
Spinrilla is an Atlanta based streaming service that specializes in hip hop mixtapes, featuring emerging and independent hip hop artists.
Primephonic is a Dutch-American start-up that addresses the pain points that many classical music fans experience with major streaming services like Spotify and Apple Music. Primephonic offers a better search engine, more unconventional recommendations, higher audio quality, and detailed album information. It also pays out classical artists more fairly.
Thomas Steffens, Primephonic CEO, said, “It has become very clear that the ‘one platform fits all genres approach’ of major streaming services such as Spotify and Apple Music is increasingly causing frustrations with music lovers. They want a streaming service that truly understands and embraces their genre by making relevant recommendations, flawless search, etc.”
He continues, “Major streaming services have ignored the specific needs of niche genres, and classical music in particular. Worldwide around 4% of all music consumption is classical, but classical is only 0.7% of all streamed music. Many classical music fans are ignoring major streaming services because they can’t find the works and recordings they are looking for, do not get recommendations that excite them, are not offered audio quality that classical music fans need, etc. That is why we have developed a streaming service, designed for classical from scratch, offering much better search, recommendations and audio quality.”
The conclusion from the research is that there is the potential for a 5-7 fold increase in growth in the US music streaming industry if it can meet the needs of more discerning customers, particularly among niche genres like classical and jazz,
Primephonic is now available in 154 countries with a classical music catalogue containing 2.5 million tracks.
*Primephonic commissioned YouGov PLC, a third party, professional research and consulting organization, to poll the views of a representative sample of 1,000 US adults (aged 18+) during May and June 2019.
