Read original story on: Wired
It’s been widely reported that when it comes to music, today’s teens tend to just stream it instead of buying on iTunes. The Wall Street Journal reported that digital music sales on iTunes, the world’s biggest music seller, had declined 13 percent to 14 percent since the start of the year. But what if their media consumption habit has spread to other media content as well?
During the last quarter, Amazon’s North American sales of media—books, music, movies, games—grew five percent of quarterly growth, the lowest year-over-year growth in North American media sales in over five years. If this is any indication, then it looks like younger generations are indeed choosing convenient access to media content over physical or digital ownership.
Ironically, this long-predicted shift in consumer priorities also seems to be perpetuated by the digital media sellers themselves. In the case of Amazon, textbook sales dipped sharply in part because Amazon makes textbook rentals so easy, similar to the way Amazon Prime Video discouraged DVD purchases. Similarly, Apple also has iTunes Radio for streaming music, not to mention the soon-to-integrated Beats music.
That being said, there might be a bit of over-generalization, as Gen Z evidently does still listen to MP3, paid for or not. Still, the trend towards a rental-based, on-demand economy has been a long time coming. And with the younger generations embracing such ways of media consumption, it’s time for companies built on the practice of purchasing media to reexamine basic assumptions.
After some tests in Japan, Apple is now rolling the iTunes Pass in the states. The new feature embedded in the Passbook app allows users to add credit directly to their iTunes Store accounts. Such a feature signals Apple’s intention to reach an even wider range of customers with its digital stores by simplifying the process for iTunes account refill. In addition, this move towards mobile could also indicate that Apple could eventually make a broader play for iOS-powered native mobile payments.
When Beats Music announced its streaming music service, many wondered how it would be able to compete with the likes of Spotify and Pandora, the industry heavyweights. Now we have a better idea; after their acquisition by Apple, Beats Music is using its industry clout to gain access to big exclusive singles, like Jay-Z’s remix of “Jungle.” Though Spotify has about 40 times the number of subscribers, Beats has the brand names – and now, it also has industry exclusives to lure new users.
iTunes radio has continued to brag about its performance since its launch. In slightly overlooked news, Tim Cook said that Apple’s streaming service has over 20 million listeners, who have listened to over 1 billion songs thus far. Though the service is only available in the U.S., the numbers are indicative of the fact that listeners want to be able to access their music across multiple platforms, digitally, wherever and whenever they want. Between the success of Spotify, iTunes Radio, and Rdio, among others like GrooveShark, it’s clear that music listeners prefer this type of listening experience.
Though iOS 7 is the big story of the day, iTunes Radio is out now in the latest iTunes update. It’s a Pandora-like feature that allows users to create custom radio stations based on their personal musical libraries. It’s supported by ads at the moment, so users will have to part with $25 to upgrade to iTunes Match, which keeps the advertisements out of the headphones. It may be the sleeper hit of the day; this service is important to keep an eye on.
iTunes Radio is officially debuting later this year, and an Ad Age report detail how advertising will work on the new platform. Several high profile brands – like McDonalds, Nissan, and Pepsi – will be part of the launch. In January 2014, ads on iTunes Radio will become widely available via a platform called iAd for a minimum buy-in of around $1 million for either interstitial audio ads, video ads, and “slate” ads, display ads that will take over whatever screen the consumer is using. Users will be served one audio ad every 15 minutes, and one video ad every hour. Apple users, however, will be able to avoid ads by purchasing iTunes Match.
Many around the tech industry thought that Apple’s long negotiations with record companies leading to its release of iTunes Radio meant that they were trying to get copyright holdings for less. Instead, it turns out that Apple is paying more than its major rival, Pandora – to the tune of $0.13 per song, one cent more than Pandora. As well, Apple is paying out 15% of its advertising revenue over the first year of its contract, and that number will increase to 19% in the second year. Apple is offering music publishers more than twice as much in royalties than Pandora pays, meaning that iTunes Radio has the potential to be much more lucrative for record companies moving forward.
Apple announced the Fall launch of iTunes Radio, a Pandora-like streaming service geared towards music discovery and driving increased iTunes sales. Available on iPhone, iPad, iPod Touch, Mac, PC, and Apple TV the service will be free and ad supported, or completely ad-free with an iTunes Match account. While it’s hard to call the offering a game changer, there are differentiating features like voice command integration with SIRI to make song requests. Apple’s biggest advantage though should be its ability to get exclusive tracks or album previews from big artists before you can hear them anywhere else.
After a week’s worth of teasing, the Twitter music app finally launched. A service for both discovery and streaming, it’s now available at music.twitter.com, as well as in the iOS app store; of yet there is no Android app. #Music is based around a recommendation engine that pulls data from across Twitter and your followers to offer recommendations from the catalogs of iTunes, Spotify, and Rdio. Of primary importance is the Trending chart, which allows you to view – and listen to via iTunes Preview, Spotify, or Rdio – the top trending songs on Twitter. As well, there are Emerging, Suggested, and Now Playing tabs; Emerging takes data from all of Twitter to identify up-and-coming new artists, while Suggested recommends music based on who you follow, and Now Playing takes stock of the music being played at that instant by the people you follow. Listening to the songs is straight forward as well, just log in with any of the previously mentioned services and you should be able to listen to full songs in the app. You can, however, click the iTunes button and be taken to the iTunes Store to purchase the song. How well this catches remains to be seen, but what is definite at the moment is that you’ll soon get to know how good your followers’ taste in music really is.
Russia is obviously a big market. But so far they have not had access to iTunes. This could change the way Russians consume media.