Spotify will do something in the US market, especially with this level of hype and financing.
But there’s a serious battle ahead, one that promises to produce huge consumer lessons. Coming this fall, it’s Apple’s iCloud in one corner, and Spotify in the other — and here’s why the iCloud ultimately prevails…
(1) The iCloud Is Cheaper
At present, Apple is planning to price the iCloud at $24.99 – a year – which easily trumps Spotify’s Premium pricing plan of $9.99 a month (or even the $4.99 Unlimited charge). And price matters, especially ‘in this economy’.
(2) The iCloud Might Become Drastically Cheaper…
Remember, Google’s music cloud is still in beta, and could be free. Which means, Apple may decide to drastically drop its price – or even position the iCloud for free as well.
(3) It’s a One-and-Done Market…
…at least on the paid side. Consumers don’t need two clouds, multiple apps, or overlapping services. And if they pay for one, the industry should consider itself lucky.
(4) There’s No Missing Music.
Sorry, I don’t get it. Spotify says they’re giving me the universe of music at my fingertips, but I keep finding annoying gaps. Then, I’m told I can fill those gaps with my own collection….
That’s one approach, but the iCloud is simpler. It’s just your personal collection – one thing, the music you want, accessible anywhere. Which raises the next point…
(5) The iCloud Is Closer to Current Usage Patterns.
Subscription remains a theoretical possibility in the US, but downloading and owning music are very tangible realities. Extending that collection into the cloud is less of a stretch for consumers. And remember, subscription has been struggling for about a decade on this side of the Atlantic.
(6) It’s Apple.
And people are infatuated with Apple. But beyond this sometimes-ridiculous love affair, Apple has a bigger marketing platform, and their own hype cycles (especially this fall). They also enjoy the luxury of constant consumer contact, especially when the hype wears off on Spotify.
(7) People Don’t Care About Music as Much as We Think…
This is one of the hardest pills for music industry types to swallow. I’ve been spending the last few days on Spotify rating obscure disco songs and delving into the Samiyam catalog, but that’s not the world! Most listen to a small percentage of their existing iTunes collections, and aren’t plunging into the Tail. And that favors a structure like the iCloud, not Spotify.