casrm.blogg.se - Spotify vs apple music 2020

In April 2020, Apple CFO Luca Maestri indicated paid subscriptions for Apple Music was “up strong double digits.” In July 2020, Maestri said Apple Music experienced “strong double-digit growth.” Based on December 2019 estimates from Counterpoint Research of 68m paid subscribers, Loup estimates Apple Music currently has about 82m paid subscribers. While Apple does not report its paid music subscribers on a quarterly basis, the company does report on milestones. Spotify reports quarterly paid subscribers. We compared paying subscribers for the top two global music streaming platforms over the last eight quarters. Notably, the global music streaming market as a whole has become more competitive in the last two years with the rise of Amazon Music, YouTube Music, Tencent Music, and multiple other offerings with fractional market share.We estimate market shares for the two companies were 35% and 18% respectively in 2018. We currently estimate Spotify has 34% global share compared to 20% for Apple. While Apple Music is growing paid subs faster than Spotify, the overall market share between the two companies has remained stable over the last two years.

We estimate the average Apple Music subscriber is paying about $7.00 per month, which equates to about $6.8B in revenue this year, or 2.5% of total revenue.

Apple Music has room to grow with 82m subs out of 980m active iPhone users (8%) paying for the service.

Separately, iOS owners have more disposable income than the average Android owner, which also plays into paid subscriber adds. Adjusting for addressable market (we estimate more than 95% of Apple Music subscribers are on iOS), our estimates indicate that Apple is converting potential customers into paying customers at a rate 2.5x faster than Spotify. We believe this faster conversion is driven by consumers valuing integrated experiences, which Apple’s ownership of iOS provides.

Since 2016, we’ve compared Spotify and Apple Music to quantify how iOS ownership impacts paid subscriber growth. The company’s ability to promote its own services within its existing hardware-software ecosystem represents a competitive advantage. At the upcoming fall iPhone event, Apple is expected to announce service bundles which will include combinations of Apple Music, Apple TV+, Apple News+, and iCloud.