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Services which stream music such as Spotify and Apple Music have grown significantly. Subscribing to these services means customers benefit from having unlimited access to a range of music without ads. In addition, music can be downloaded so that it can be played when offline. With Spotify and Apple Music offering this service for £9.99 a month it is no wonder why they are becoming so popular. They give customers the freedom to enjoy any type of music they like, anytime. Other popular platforms include Google Play Music, Deezer and Prime Music.
However, this streaming success is causing problems for video platforms such as YouTube and Vevo. A study from BuzzAngle on the US Music Business discovered that streaming of online music videos increased by only 7.5% during 2016, whereas streaming of music on-demand platforms rose by 83%. Streams increased to 250.73 billion in 2016 from 137.29 billion in 2015. This shows how popular they have become.
The results also showed a preference for subscription options and signified paid streaming apps such as Apple Music have gone up by 124% over the past year. Whereas, the streaming of music financed by ads (e.g. the free version of Spotify) had a slower incline, only rising from 51.96 billion (2015) to 59.36 billion (2016).
The major difference in growth between on demand streaming of music and video music streaming indicates a shift in customer preference, with more and more consumers choosing subscription services. Having complete access to a vast music library at their fingertips seems to be a huge draw. The downloadable apps also allow the music to be streamed quickly and easily. Personal playlists can be created and suggested music is also available providing a complete customer experience.
Although on demand streaming is gaining recognition, video streaming should still stay of relevance to consumers as they get the experience of viewing the music videos as well as listening to the audio.
In general, 2016 was a success for the music business. The overall music expenditure rose by 4.2% from 2015. Predictably there was a 12% decline in CD sales. However, the shift to music streaming has aided the music business largely, leading consumers to spend more on music and thus increasing profits.