Streaming music is just like bottled water, right? Not all, actually.
1. People happily pay outrageous premiums for bottled water (a glass of tap water costs about $0.001).
Relatively few people actually pay for streaming music.
2. People are convinced that there’s a difference between bottled water and tap water.
Not enough people feel there’s a difference between ad-based (free) streaming and premium (paid) streaming.
3. Sometimes, tap water tastes funny.
Free streaming always tastes good! You just have to wait for it a little longer.
4. Bottled water is a proven, $100 billion industry that’s been around for decades.
Streaming music isn’t a profitable industry, hasn’t been around for more than a decade, and remains financially speculative.
5. There are many, highly successful companies selling bottled water at your supermarket.
There are only one or two companies successfully selling premium music subscriptions (and that’s a stretch).
6. The bottled water industry has convinced its consumers that tap water isn’t safe or clean enough, even though this isn’t necessarily true.
The streaming music industry has taught consumers that free streaming is not only sufficient, but a potentially superior option.
7. The bottled water is successfully competing with free.
The streaming music industry is losing against free, and constantly lowering its price or giving away music for free (to… compete with free).
8. The bottled water industry coexists with dozens of other beverage choices (Coke, juice, tea, Vitamin Water, beer, wine, etc.)
The streaming music industry is cannibalizing every other form of music consumption (with the exception of vinyl and live concerts).
9. Bottled water isn’t sexy, but it IS profitable.
Streaming music IS sexy, but ISN’T profitable.
10. There is product differentiation and price differentiation between various bottled water brands (Poland Spring, Dasani, Perrier, Fiji Water, Deer Park, Pelligrino).
There is little price (or even product) differentiation in premium streaming music (though services like Beats may start to change that).
11. The bottled water industry is often accused of screwing the environment.