Michael Simon, Macworld:
The Spotify executives on stage never actually mentioned Apple Music by name, but it was impossible not to catch the vibe. Throughout the hour-long presentation, Spotify barely talked about its Premium service, which boasts some 70 million users to Apple Music’s 40 million. Instead, the focus was on Spotify’s other 90 million customers, the ones who don’t pay.
And:
As it stands, the only “free” tier of Apple Music involves listening to either Beats 1 or whatever songs are in your music library. Otherwise, you’re completely locked out.
Spotify sees things differently. While its Premium tier offers the same $10-a-month access to tens of millions of songs as Apple Music, Spotify also lets non-paying customers in the door, with restrictions on playback and interspliced ads. It’s a gateway to Premium for sure, but more importantly, it’s the main advantage Spotify has over Apple Music. And it just became irresistible to tens of millions of users.
And:
Spotify’s isn’t going after Apple Music users with a better premium offering, it’s basically offering a free sample that doesn’t have an expiration date.
There’s a subtle strategic difference between offering a free trial period and a free, ad-supported tier. Apple Music’s free trial period has no “lock in” in it. Once you reach the end, you’re either in (you find the service worth the money and you sign up) or you’re out (possibly heading over to Spotify). There’s no stickiness to keep you in the fold.
With Spotify’s focus on making their free tier more attractive, they’ve achieved “lock in”. If you hate the ads, pay the monthly fee and get an even better experience, ad free.
My two cents? I think Apple should copy this move, adopt a free tier. Of course, that will likely put a dent in their services revenue, but if this helps grow their user base, that should make up for any shortfall there.
One more thing:
The only real advantage Apple has with Apple Music (other than it being the default music app on hundreds of millions of iOS devices every year) is HomePod compatibility. I half expected Spotify to launch a competing speaker at its event, but as I listened to the executives talk about the new features, it became clear that hardware isn’t their game.
When people question Apple’s HomePod move, this has to be part of the discussion.