So it turns out that despite all the heady optimism surrounding streaming services, adding subscribers is actually pretty difficult. In fact, getting non-paying free users to simply stick around also turns out to be really hard – and we’re talking about free stuff here.
According to industry analyst Mark Mulligan, this is the reason why Spotify churns through nearly two million subscribers just to get 400,000 to stick around (in any capacity), and why Rhapsody is treading water on their subscriber levels. It also may help to explain why Deezer has an inactive, zombie ‘userbase’ of approximately 20 million. These are registered accounts, that are never getting logged into.
Here’s the side-by-side comparison of Spotify and Deezer, and presented by Mulligan at a recent symposium at SXSW.