Music streaming services must evolve to survive, says new report

music streaming services will never turn profit says new report spotify

According to a new report from analysts Generator Research, music subscription services such as Spotify will never be able to make a profit in their current state — and that’s largely because of the hefty royalty fees they have to pay out to artists, the labels that represent them and rights management groups.

The dollars and cents that actually trickle down to the artists themselves isn’t very much — as Thom Yorke and others have pointed out — but nevertheless subscription streaming services currently hand over 60-70 percent of their revenue to record labels and other interested parties, and Generator Research says that’s unsustainable.

All is not lost, though. Subscriptions to Spotify, Rdio, Pandora et al are expected to more than double by 2017, and Generator Research analysts believe new ways of boosting income can be found. This could include bundling music streaming privileges with mobile contracts or broadband deals, for example.

“Music subscription services providers are all losing money, and that is going to remain the case until they find a way to monetize a worldwide user base,” explains the study, as reported by ComputerWorld. “Putting to one side the quality of the actual service, which most users would rate very highly, the facts show that Pandora — when viewed objectively as a business — is in dire straits. We are at a loss to know why the company’s stock has performed so well, especially over the last 12 months.”

Another potential revenue stream could involve anonymized behavioral data being sold on to advertisers. The most important source of growth, according to the report, is converting free users into paid ones: both Spotify and Rdio have relaxed free listening limitations in recent months.

For a more complete guide to the labyrinthine payments system currently in place in the music industry, have a read through our previous posting.

Music

Apple Music may sign up more exclusive artists with purchase of Platoon

Apple purchased London-based Platoon, which is a startup that helps independent musicians get discovered by major labels. The acquisition may help Apple Music sign up more exclusive artists.
Home Theater

Netflix vs. Hulu vs. Amazon Prime: Battle of the streaming giants

Trying to figure out which subscription streaming service to use while sticking to a frugal entertainment budget? Check out our updated comparison of the big three: Netflix, Amazon Instant Video, and Hulu.
Music

Here's our head-to-head comparison of Pandora and Spotify

Which music streaming platform is best for you? We pit Spotify versus Pandora, two mighty streaming services with on-demand music and massive catalogs, comparing every facet of the two services to help you decide which is best.
Music

Spotify is the best streaming service, but its competitors aren’t far behind

It can be hard to decide which music streaming service is for you, so we've picked out the individual strengths of the most popular services, aiming to make your decision a little easier.
Mobile

G’day, Google: U.S. users can now give Assistant a British or Australian accent

U.S. Google Assistant users can give their Assistant a different voice. Google has updated Assistant with the ability for users to give it either a British or Australian accent, which could make it a little more personal for some.
Music

Tune in to the best internet radio stations for your listening pleasure

Even in the streaming era, radio stations get some of the best exclusives and curate some of the finest handpicked playlists around. Here are the best internet radio stations, for your listening pleasure.
Mobile

Leave the laptop at home, the iPad Pro is the travel buddy to take on vacay

The iPad Pro is a powerful tablet that's perfect for creatives and professionals. How does it fare when traveling with it as a laptop replacement? We took it on a two week trek in Japan to find out.
Computing

Microsoft’s latest patent paves the way for Andromeda dual-screen mobile device

The latest patent discovery from Microsoft showcases a new hinge design for quickly opening a dual-screen mobile device with a single hand. Could this be additional proof surrounding the rumors of the company's Project Andromeda device?
Mobile

Need to record calls on an iPhone? Check out our handy guide

Are you wondering how to record calls on your iPhone? It isn't as easy as you might think, but we'll walk you through the process of doing so with Google Voice, and identify several other apps and external voice recorders that can help.
Home Theater

Set your ears free with the best completely wireless earbuds

If you can't stand the tangle of cords, or you're just excited about completely wireless earbuds, you're going to need some help separating the wheat from the chaff. Our list serves up the best true wireless earbuds around.
Mobile

Apple is spending $1 billion to hire up to 15,000 new employees in Austin

Apple has announced a series of expansions across the U.S. -- including a massive expansion to the company's Austin campus that will see it spending $1 billion to accommodate for up to 15,000 new employees.
Outdoors

Google Maps makes it easier than ever to find a Lime bike or scooter

Google Maps has added a new feature that helps you find a Lime bike or scooter in just a few taps. The feature currently works in 11 U.S. cities served by Lime, with more coming next year.
Mobile

Quirky smartphone accessories you never knew you needed

Looking for a few accoutrements to make your smartphone even better? If you, or someone you know, is a sucker for accessories, you'll want to check out our collection of quirky smartphone accessories you never knew you needed.
Mobile

Ditch your smartphone for a year and win $100k from Vitaminwater

Vitaminwater is willing to part with $100,000 if you're willing to part with your smartphone partner for a year. Could you last for a year armed with only a 1996-era phone? Here's your chance to find out.