Apple Music is a music streaming service developed by Apple Inc. It offers access to over 90 million songs and 30,000 playlists. Since its launch in 2015, Apple Music has grown to become one of the most popular music streaming services in the world, with over 90 million subscribers as of 2022.
The history of Apple Music begins with Apple’s acquisition of Beats Music and Beats Electronics in 2014. This acquisition allowed Apple to use Beats’ streaming technology as the basis for its own service. When Apple Music launched in 2015, it disrupted the music streaming landscape and has since had a major impact on how people listen to and access music.
Over the past 7 years, Apple Music has continued to evolve by adding new features and expanding to more countries. It has also formed key partnerships with record labels, artists, and other streaming platforms. While facing competition from services like Spotify, Apple Music has managed to grow steadily and become deeply embedded into Apple’s ecosystem of products and services.
This article will explore the origins, launch, evolution, and impact of Apple Music over its 7 year journey to becoming one of the top music streaming services globally.
Origins
The origins of Apple Music can be traced back to the development of iTunes and the iTunes Store. Apple first launched iTunes in January 2001 as a media player and library for Mac users. Over the next few years, Apple continued improving and expanding iTunes by adding support for Windows, the iPod, podcasts, audiobooks, and more.
In April 2003, Apple opened the iTunes Store, allowing customers to purchase songs for 99 cents each. The iTunes Store quickly grew in popularity and transformed the music industry by providing a convenient and legal way to download digital music. According to The iTunes Store PowerPoint Presentation, by September 2003, the iTunes Store had sold over 10 million songs.
The massive success of the iTunes Store established Apple as a major player in the music industry. As iTunes grew into the world’s largest music retailer over the next few years, Apple sought new ways to evolve its music services.
Acquisition of Beats
In May 2014, Apple announced that it would be acquiring Beats Electronics as well as its Beats Music streaming service for $3 billion. This acquisition was Apple’s largest deal ever at the time. Beats co-founders Dr. Dre and Jimmy Iovine joined Apple as part of the acquisition.
Apple’s motivation behind acquiring Beats was to bolster their music offerings by bringing the Beats streaming service into the Apple ecosystem. At the time, Apple’s iTunes downloads were in decline as streaming grew in popularity. Acquiring Beats and its streaming technology would allow Apple to quickly enter the streaming market.
As reported by Business Insider, Apple’s CEO Tim Cook said “We get a subscription music service that has an incredible brand, we get incredible artists and we get a great talent in Jimmy and the team…we’re acquiring a very rare set of talent.” The deal helped Apple catch up in streaming by essentially ‘buying’ talent and technology rather than having to build it from scratch.
Launch
Apple Music officially launched on June 30, 2015 in over 100 countries. The launch came nearly 3 months after Apple acquired Beats Music and announced plans for its new streaming service. Apple marketed Apple Music as a single app that combined the best features of Beats Music with internet radio through a new service called Beats 1. AppleMusic also integrated a user’s existing iTunes library with an on-demand streaming catalog of over 30 million songs.
The iOS 8.4 update on June 30 enabled Apple device users to access Apple Music. The service was available through iTunes on Macs and PCs, as well as on Android devices beginning in the fall of 2015. At launch, Apple Music offered a 3-month free trial period, after which subscriptions were $9.99 per month for individuals or $14.99 per month for families of up to 6 members. Students could subscribe for a discounted price of $4.99 per month.
According to a report by Engadget, Apple Music aimed to boost declining music sales and recover market share lost to streaming competitors like Spotify. The launch gave Apple an on-demand streaming service to better compete for listeners in the growing streaming music space.
Growth
Apple Music saw tremendous growth in subscribers and revenue in its first few years. Within 11 months of launch, Apple Music had over 17 million paying subscribers.Data shows that by June 2017, Apple Music had 27 million subscribers, while competitor Spotify had 50 million paying users. Though initially lagging behind Spotify in subscribers, Apple Music began generating higher revenue per user – an average of $3.82 per month for Apple versus $2.83 for Spotify as of 2017.
This growth continued over the next few years. By 2018, Apple Music had over 50 million subscribers, and by 2019 it had surpassed 60 million subscribers worldwide. Streaming revenue also grew substantially, reaching almost $4.5 billion in 2019. While Spotify still maintains a slight edge in total users, Apple Music has made significant market share gains while generating strong revenues.
Features
Apple Music offers users access to over 100 million songs as well as a wide range of features (Apple Music). Some of the key features include:
Radio – Apple Music has Beats 1 Radio, a global 24/7 radio station focused on the latest music. There are also hundreds of genre-specific radio stations available (11 Apple Music Features You Should Be Using).
Playlists – Apple Music offers thousands of expertly curated playlists across many genres and moods, including popular ones like A-List Pop and Today’s Hits. Users can also create their own custom playlists.
Exclusives – Apple Music frequently premieres new albums and songs before any other streaming service, like Beyonce’s Lemonade in 2016. Users also get access to exclusive live sessions and interviews with top artists.
Partnerships
Apple Music has formed partnerships with major record labels like Universal Music Group, Sony Music Entertainment, and Warner Music Group to license their music catalogs for streaming on the service. They also work with independent labels and distributors to bring a wide variety of music onto the platform (Kieran Mansfield).
In addition to record labels, Apple Music partners directly with artists for exclusive releases, live streams, and other content. For example, Apple Music had a partnership with Frank Ocean in 2016 for the exclusive release of his albums Endless and Blonde (Jimmy Iovine Discusses Frank Ocean, Kanye West, and Apple Music’s Strategy).
The company also negotiates artist partnerships for branded content and advertising campaigns. According to self-reported salaries on Glassdoor, the average base pay for an Apple Music Partnerships role is $137K per year (Apple Music Partnerships Salaries).
Impact
Apple Music’s launch in 2015 had a major impact on the music streaming industry. At the time, Spotify dominated music streaming, but Apple Music quickly emerged as a formidable competitor (https://www.digitaltrends.com/mobile/apple-music-vs-spotify/). As another major tech company entering music streaming, Apple brought more consumer awareness, marketing dollars, and technical innovation to the space. This intensified the competition with Spotify.
Within just a few years of launch, Apple Music amassed over 50 million subscribers, demonstrating rapid growth and popularity (https://www.soundguys.com/apple-music-vs-spotify-36833/). Its success forced the entire music streaming industry to step up their offerings in order to compete. Streaming services expanded into new territories, invested in exclusive content, and developed new features in response to Apple Music’s growth.
Apple Music also impacted artist royalty rates and revenue. Its entry provided artists and labels more leverage in negotiating rates with streaming services. However, Apple Music pays artists a little less per stream compared to competitors (https://artists.apple.com/support/1124-apple-music-insights-royalty-rate). This demonstrates the complicated impact Apple Music has had on the streaming revenue model.
Overall, Apple Music greatly accelerated the music industry’s shift to streaming by providing a credible streaming option alongside Spotify and others. It also catalyzed innovation and competitive intensity in the market, forcing changes across the industry.
Recent Developments
In 2021, Apple Music introduced several new features to enhance the listening experience. This included adding support for Spatial Audio with Dolby Atmos, which provides an immersive listening experience by positioning sounds all around the listener. Apple also added Lossless Audio support up to Hi-Resolution Lossless at 24 bit/192 kHz for the highest quality sound recordings.
On the video side, Apple Music expanded its music videos library to over 100,000 videos, with new daily premieres. It also launched Apple Music TV featuring curated music videos, live shows, interviews and more. In August 2021, Apple Music debuted a new auto-generated playlist feature called SharePlay that makes it easy to listen to music simultaneously with friends over FaceTime. Overall, Apple continues to evolve Apple Music with new features focused on elevating music discovery and enhancing the listening experience.
The Future
As of 2023, Apple Music has reached over 100 million subscribers worldwide (Source). This makes it the second most popular music streaming service behind Spotify. However, Apple Music also faces pressures to keep growing, retain users, and improve profit margins in the crowded streaming space. Its future success will depend on several factors.
Apple Music is expected to continue expanding into new markets, especially in developing countries where streaming music is just taking off. Forecasts predict Apple Music could reach 110 million subscribers by 2025 (Source). Apple will likely keep pursuing strategies like discounted plans for students and families to attract new users.
Competing with Spotify and other services, Apple Music will need to leverage its integration with Apple devices to retain users. Exclusive content like livestreams and music not available on other platforms could help. Enhanced personalization and music discovery features are also important to keep audiences engaged. Monetizing through new revenue streams like advertising is another potential growth avenue.
While streaming is now the dominant music format, its long-term profitability remains uncertain. Apple Music currently operates at thin margins. Pressure from labels over royalty rates could squeeze margins further. But with over 1 billion iPhone users worldwide, Apple Music has a vast built-in customer base to tap for continued expansion.
