Apple unveiled Apple Music, an app-based suite of music streaming and related services, at its Worldwide Developers Conference, which took place in San Francisco on June 8-12. Apple is looking to provide a comprehensive service, with a strong emphasis on bringing artists closer together with their fans.
Over the last fifteen years or so, the music industry has undergone radical change. The golden age of the pressed disc ended when people started using the Internet for everything. Spearheading the revolution was Internet guru Sean Parker, with his peer-to-peer service Napster, founded in 1999 as a service for online sharing of files encoded in MP3 format. The company ran into legal difficulties over copyright infringement, and the service was discontinued in 2001. Since then many other firms – including LimeWire and BitTorrent – have operated illegal peer-to-peer music file exchange models. This booming trend illustrates the structural change that has taken place in the music industry: computer files, rather than physical hardware such as vinyl records, cassette tapes and CDs, have now become the main vehicle for listening to music.
On this basic premise have emerged music streaming services such as Spotify, Beats Music and Deezer, online audio distribution platforms for composers and creators, like SoundCloud, and sites that enable you to buy and download music to your device, the biggest name here being the iTunes Store with its 800 million active accounts. Now that the online channelling of music is well-established, a new challenge has arisen: how to bring fans and artists together on a single platform. This approach has the dual advantage of offering all types of original content to fans, while enabling the artists to raise their profiles. With this in mind, alongside the streaming service based on a music/music video catalogue and the ‘Beats 1’ 24-hour radio station, both of which are part of the Apple Music suite, the Cupertino-based company has also set up ‘Connect’, a site where artists will be able to post music, videos and photos for the fans who follow them.
App designed to bring artists and fans together
“Apple is historically linked to music,” declared Apple CEO Tim Cook towards the end of his presentation, in which he unveiled that much-heralded ‘One More Thing’ – this time Apple Music. Over the years Apple has made its mark on the music industry, with inter alia the launch of both the first iPod and iTunes in 2001. In fact it was the success of the iPod that started the shift from physical products to digital files, and the following years saw the launch of a range of products – the iPod Mini, iPod Nano, iPod Touch, etc. Apple then launched the iTunes Store in 2004, which crystallised the transition to purchasing music on the Internet.
Apple Music’s core catalogue service is somewhat similar to that of its competitors, notably Spotify. But in addition Tim Cook’s company has come up with ‘Connect’, a sort of social network where artists can get closer to their fans. Connect will allow fans to follow their favourite artists, who will be able to share their latest music clips, photos and their latest tweets and Facebook posts. In other words, Apple wants Connect to become the network of choice for music artists to stay in touch with their fans, avoiding the need for fans to go back and forth across a number of different social networks – Instagram, Vevo, YouTube, et al – to follow their heroes. They will instead be able to interact directly with their chosen performers via comments, ‘likes’ and ‘shares’.
A few months ago, leading American rapper Jay Z brought a number of music industry heavyweights – including Daft Punk, Kanye West and Beyoncé – on board to launch his own streaming service called Tidal. The service will focus on the artists themselves, offering original content in a range of formats – video, short films, etc – and a high quality listening service. More recently, market leader Spotify announced it was planning to offer new types of content, including artists’ exclusive videos, clips and written articles. Meanwhile the Swedish firm has just raised $526 million in new capital to help it fend off the threat from Apple.
All these services are based on the freemium model, given that access to a huge catalogue of music has now become a commodity. The providers then look to create premium value through the variety and quality of the additional content they offer subscribers: official clips, videos shot backstage at concerts or between studio takes, tweets, photos, and more. It is this type of content and the opportunities for fan interaction that the streaming service providers hope will help stimulate user-engagement and create added value.