Despite some long overdue improvements to Apple Music, not to mention a renewed focus on obtaining exclusives from big name artists, Apple’s streaming service just can’t seem to do anything to slow down Spotify’s momentum. While Tim Cook this past September boasted that Apple Music now has more than 17 million subscribers, Spotify’s subscriber count has reportedly passed the 40 million threshold. In short, Apple Music is still growing, but Spotify is growing at a much faster clip.
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In an effort to remedy this, a new report from Digital Music News claims that Apple is seriously considering implementing a price drop to attract new streaming subscribers and lure existing subscribers away from rivals like Spotify and Amazon Music. Citing two sources who are purportedly familiar with Apple’s plans, Apple Music may reduce the somewhat standard monthly $9.99 rate down to $7.99 a month. The family rate, meanwhile, would see a drop from $14.99 to $12.99 a month.
“The move could come as soon as this Christmas,” the report adds, “and possibly start with a holiday promotional discount.”
Interestingly enough, it was initially reported that Apple, in the weeks and months leading up to the launch of Apple Music, was aiming to undercut Spotify in order to accelerate subscriber growth right out of the gate. With music labels reportedly unwilling to take a hit to their bottom line, Apple’s plans were thwarted. That said, if the report from Digital Music News is accurate, it stands to reason that Apple in this case would be willing to take a revenue hit in a play for a larger subscriber base. Also interesting is that Spotify isn’t the only streaming provider on Apple’s radar.
Amazon appears to be the biggest motivation for the pricing discussions. The reason, unsurprisingly, is that Amazon Music is pretty damn cheap compared to their competitors. The full-blown, just-launched Amazon Music Unlimited subscription is currently $9.99, though that price drops to $7.99 for Prime subscribers.
But there’s a huge sweetener in this: a free, ‘Prime Music’ option for more casual music listeners. That, more than anything, presents a major threat to Apple Music’s growth arc, with Spotify also under pressure to adapt. And the reason is dead simple: why pay $9.99, or even $4.99, when it’s already bundled into your existing Prime account?
For what it’s worth, Apple Music does have the highest customer satisfaction rate in the business.
