TIME Apple

The New Apple Ads Will Make You Feel a Million Feelings

Lionizing the history of music and then some

Ads from big, consumer-oriented tech companies have followed a pattern over the past decade or so—presenting software, services, and gizmos as bringing people together, in perfect harmony. The ads for the new Apple Music service fall right in line.

One of the three new spots features a voiceover from Trent Reznor of Nine Inch Nails (and Beats, which Apple acquired for more than $3 billion) telling us that the service treats music “less like digital bits and more like the art that it is, with a sense of respect and discovery.” And Apple, he says, means to “actually accommodate and support the artists who make the music, and not just the top-tier artists, but the kids in their bedrooms, too.” The implication is that Apple will do this better than services like Spotify.

Whether this turns out to be the case, only time will tell.

In another spot, the focus is entirely on the history of recorded music. It depicts all different kinds of people, in all different kinds of places, enjoying music. It starts with the first phonograph in 1888, and courses through hi-fi systems, jukeboxes, cassette tapes, and computers, and ends with, of course, Apple Music, which is depicted here as the culmination of all this history, the technological endpoint, which of course it isn’t.

The third spot is the most true to the holistic, global vibe that has become obligatory in ads from big tech companies like Microsoft, Google, and Apple itself. And it’s the most branding—oriented. It shows people around the world doing things—running, dancing, crying, doing sit-ups—while listening to Pharrell’s “Freedom.” The way the music is muffled for the part showing a woman crying is a nice touch.

Don Draper was depicted in the series finale of Man Men as having created the iconic “Teach the World to Sing” Coca-Cola ad. Being a fictional character, he obviously didn’t, but the way his idea was presented—as being born of true sentiment and a genuine wish for global togetherness, wasn’t really far off reality. He was trying to sell sugar-water, sure. But that’s not all he was doing. And we can presume Apple believes in its own image, too, even as it’s trying to separate people from their money by presenting that image to them. It’s all in the game.

TIME Apple music

Spotify Just Raised Lots of Money to Take On Apple’s New Music Service

The 'unicorn' music startup won't go down without a big fight

It only took Spotify one day to get back into the conversation after Apple’s big product event earlier this week.

On Monday, at its annual Worldwide Developers Conference in San Francisco, Calif., Apple announced the coming launch of Apple Music, its own digital music streaming service. On Tuesday, Spotify closed a massive new funding round worth $526 million.

The investors include Goldman Sachs, GSV Capital, Asset Management Partners, D.E. Shaw, and a number of British and Canadian groups. The round amounts to a Series G for the Stockholm-based startup (it has raised $1.1 billion to date), which is helmed by founder Daniel Ek. The round also gives Spotify, already a tech “unicorn,” a new valuation of $8.53 billion, up from $8 billion. For those keeping score, that’s more than double Pandora’s current market cap, and it’s nearly triple what Apple paid for Beats By Dre.

More: Read about Apple in the new Fortune 500 list

This funding round had been in the works for months, long before Apple’s announcement; the Wall Street Journal first reported the round in April, although it predicted the round would be just $400 million. Still, the round’s official closing on Tuesday brings Spotify immediately back into the conversation with some news of its own, after Apple achieved big hype from its big reveal on Monday. (As Fortune‘s Philip Elmer DeWitt pointed out, the announcement “occupied the coveted ‘one more thing’ spot” at the end of the event.)

Digital music companies — from Spotify to Pandora to Rdio to Jay Z’s Tidal — are facing increasingly hot competition from both rival players, and from bigger, broader tech giants such as Sony and Google.

In the wake of Apple’s announcement about Apple Music, there has been an attitude among many that the space will become a two-horse race between Spotify and Apple. Spotify’s big new round bolsters that prediction and makes a big statement.

TIME Apple

Apple Is Still Negotiating With Record Labels Days Before the Deadline

Apple Said To Be In Talks To Purchase Beats Headphones Company
Andrew Burton—Getty Images

It's set to unveil the new service soon

Apple is set to announce a new streaming service in the coming days that would compete with products offered by companies such as Spotify. But there’s just one catch: they haven’t actually struck a deal with record labels for access to their music, according to a report in Bloomberg News.

For years, Apple has dominated the digital music space, with its iTunes music software capturing huge shares of the market for digital downloads. But recently, consumer tastes have shifted from downloading to streaming, putting Apple in the position to play catch up with upstart services such as Spotify. Tamara Gaffney, principal of Adobe Digital Index, told Bloomberg that the central theme of the negotiations is: “Who is going to get the majority share of the profit from the content?”

She continued:

“Apple has always wanted to get a lot of the share, and they’re now in a negotiating situation with content manufacturers who want more of the share for themselves — it’s a really tough space.”

While Spotify pays labels 55% of its subscription revenue, the labels are playing hardball with Apple, asking for closer to 60%, according to the report.

More: Check out Apple on the new Fortune 500 list

TIME Spotify

Here’s How Much Artists Really Make on Spotify

It varies based on what kind of user is listening

Music lovers take note: streaming a song on Spotify makes your favorite artists very little dough.

An analysis of data from December 2014 that Spotify recently released to music publishers shows that a song played on Spotify Premium—the ad-free service that costs listeners $10 per month—results in royalties worth 0.68 of a cent. If you think that’s a paltry sum, consider this: songs played on Spotify’s free service garner even less money: on average, 0.14 of a cent.

Because a song play on Spotify Free earns an artist about one-fifth as much as a play on Spotify Premium, the music streaming company is under pressure from some folks in the music industry to set restrictions on its free tier by limiting the music available to Free users, or by capping their song plays, The Wall Street Journal reports.

Right now, users of Spotify Free can access the same 30 million songs as Spotify Premium listeners, only with ads. The company has said that the current format turns free users into subscribers. Premium users made up 25% of Spotify’s 60 million active listeners last year, down from 28% the year prior.

More: Check out the new Fortune 500

TIME apps

This Is the Coolest Feature Spotify Added Today

This is a far cry from the days of hoping your Discman didn't skip

Runners of the world, Spotify has got the update for you. The popular music streaming app is adding a special mode for running that plays music that syncs up to the pace of your run, along with a slew of other new features.

The feature works like this: you start the running mode, and then you start running. Using the technology already in your phone, Spotify figures out how fast you’re going and picks music where the beats-per-minute matches up. You can choose to either have music selected based on what you’ve listened to before, use a multi-genre playlist or hear new tracks made by DJs specifically for running.

So if you’re just going for a pleasant jog, we’d imagine you might get something mid-tempo, like Mumford and Sons. Run a little faster and maybe some Jay-Z will hit you. If you’re really going all out, it would make sense that Spotify would play some gnarly fast, double-bass driven thrash metal, like Slayer.

TIME streaming media

Everything You Need to Know About the New Spotify

The new Spotify goes way beyond music

In a press event on Wednesday, streaming service Spotify made one thing clear: it’s no longer just for music.

CEO Daniel Ek said the firm’s mission is to find the perfect content—whether audio or video—for every moment of its users’ days. Ek and Spotify executives unveiled a new version of the service that tailors playlists for individual users. The new version also incorporates podcasts into its app. A so-called “video capsule” will make videos from partners such as Comedy Central, Vice News, and The Nerdist available as well.

Highlights from the announcement included:

— Media partners include: ABC, BBC, ESPN, NBC, TED, MTV, Maker, Slate, Fusion and E!

— A new running menu changes the way people use the app. The company says it can detect a runner’s tempo and immediately start playing songs that match.

— The new Spotify is rolling out US, UK, Germany, and Sweden beginning May 20.

— Ek said the focus on custom playlists will allow it to better target ads.

— Spotify is also partnering with fitness brands like Nike and RunKeeper to better integrate apps.

— D’Angelo and Questlove performed to play Ek out.

Spotify is retooling as it faces more competition in the streaming market. Though Spotify says it accounts for more than 50% of the streaming market, new services have recently launched or are preparing to launch to take on its dominance. Jay Z’s Tidal is trying to attract customers with exclusive music videos and live concerts. Later this summer, Apple is widely expected to unveil a new streaming service based on Beats Music which it acquired as part of $3 billion buy of the headphone-maker.

TIME Starbucks

There’s a New Way to Get Starbucks Rewards Points (and Music!)

Cold_Brew_(4)
Starbucks Starbucks Cold Brew

Starbucks and Spotify are working together after the coffee chain stopped selling CDs.

Starbucks and online streaming service Spotify are teaming up, allowing Starbucks to stay in the music sphere even after the coffee chain stopped selling compact disks in March.

Customers will be able to see lists of songs played baristas in their coffee shop under a new section in their app. Starbucks will also offer Spotify users rewards points to its loyalty program.

The partnership with Spotify comes after Starbucks stopped selling physical CDs in March after more than 20 years. Artists who’ve seen their work featured on the counter next to the pastries include Bonnie Raitt and Aretha Franklin.

“For many, many years, music has been a very significant part of the Starbucks experience,” CEO Howard Schultz said, per Bloomberg. “The music in our stores gave us license over the years to be in the physical CD business and as many of you know that turned into a very, big and important business for Starbucks.”

MONEY Streaming Music

Rdio Is Taking On Spotify and Apple with Discount Streaming Service

Man wearing headphones on city street
Alamy

Rdio Select will cost just $3.99 per month.

Spotify competitor Rdio has launched one of the cheapest music streaming options yet.

The new pricing tier, called Rdio Select, will cost $3.99 per month and offers listeners unlimited ad-free “stations”—streaming radio based on a song, genre, or a variety of other criteria—with unlimited skips, as well as the ability to download up to 25 songs for offline use.

Twenty-five songs “is more than most users download in a day, so we feel it’s enough,” said Rdio CEO Anthony Bay in an interview with BuzzFeed News. Bay also clarified that the small number of downloads is what allows Rdio to keep the price so low.

Rdio Select adds an interesting middle ground to industry that generally offers either free ad-supported music or a more expensive subscription option. Spotify, the streaming music market leader, lets its 60 million users choose between a free plan that includes ads between songs or a $9.99 plan that allows for unlimited downloads. Rdio two other plans, Rdio Free and Rdio Unlimited, offer similar features at the same price points.

The news comes as Apple gets ready to relaunch Beats, the streaming service it acquired last August for $3 billion. Re/Code reports Apple has been pushing labels to lower their prices, which would allow the iPhone-maker to offers its new service at a lower price, potentially as little as $5 per month. According to the Verge, Apple has also lobbied record companies to force Spotify and other services to eliminate their free services, giving Apple’s upcoming service an advantage.

MONEY online spending

Apple Wants Us to Pay for Music All Over Again

man listening to Beats headphones
Eduardo Munoz—Reuters

As digital music sales sink, Apple is taking aim at Spotify with its rumored streaming music service

We’re just a couple months away from a possible launch of Apple’s rumored music streaming service, which is expected to turn Apple’s purchase of Beats Music into a new, Apple-branded, subscription streaming app, devoid of any free tiered streaming plans.

If in fact Apple launches this service, the company will be taking a similar approach it took in the early 2000s, when it launched iTunes and transitioned users away from pirating music to paying for it.

Apple’s latest moves
After buying Beats, Apple’s made a few recent moves that show the company may be set to change how users stream music. One of the latest moves, reported by The Verge, is that Apple is trying to convince music labels to not to renew their free music streaming licenses with Spotify. Apple’s reportedly trying to convince labels that offering up their music for free is a bad idea, and that it’s about to have a much better option.

And that’s a pretty easy sell these days. Ad-based streaming services don’t provide much revenue for artists, and music labels prefer that music listeners access music through a paywall.
The biggest example of this so far has come from Taylor Swift, who pulled her music off of Spotify earlier this year. According to Quartz, Swift’s move away from Spotify has encouraged Universal and Sony — which control more than half of the music market — to doubt the benefits of the freemium (ad-based) music streaming model.

The same article said that Sony Music CEO, Doug Morris, told Hits Daily Double that, “In general, free is death,” meaning that the music industry can’t survive if free music steaming persists.

If Apple can convince labels that its new service will bring the labels more revenue, then it could launch its new service with the backing of the industry (something which it appears Spotify might be losing right now).

After that, the next step is convincing users that Apple’s music subscription is better than the competition.

Using an old formula in a new way
Let’s not forget that Apple’s taken on a similar challenge when it launched iTunes back in 2001. Except at that time the competition wasn’t Spotify, it was peer-to-peer sites that allowed users to exchange music for free.

At that time Apple convinced the music industry that iTunes was the best option for making money, and then persuaded users that a sleek, easy-to-use program made it worth paying money to get music, as opposed to getting it for free.

Sound familiar?

Apple won’t be using a newly launched iPod and iTunes to shake up the music industry this time, but a rebranded Beats (or some revamped iTunes app) that has better features and the backing of the music industry may be just the thing to do it. If Apple convinces labels to drop their free streaming on Spotify, launches a great streaming app, and then undercuts Spotify’s $10 subscription price (which it’s rumored to be doing), then music listeners may have more of an incentive to use Apple’s new service.

What’s in it for Apple
Apple’s iTunes media sales (which include music, books and video) are on the decline as people have adopted streaming preferences over buying content. In the calendar first quarter of this year Apple’s media sales decreased by 4% (for the third consecutive quarter) and 5% in the first six months of fiscal year 2015. And in all of 2014, iTunes digital music sales were down 14% worldwide.

If Apple wants to keep its music business alive it needs to adapt to the paid streaming model, and move away from digital downloads. Research from P. Schoenfeld Asset Management estimates that by 2020 there will be about 250 million worldwide music streaming subscribers creating just over $16 billion in streaming revenue. You can bet Apple doesn’t want to miss out on any of that revenue, especially as its iTunes music sales continue to drop. All Apple has to do is convince music users, for the second time, that paying for songs is better than getting them for free.

More from The Motley Fool:

TIME Music

Here’s Everything That Premiered on Tidal Over the Weekend

New content from Beyoncé, Rihanna and Madonna may be enough to make some holdouts reconsider

Tidal, Jay-Z’s new music streaming service, recently premiered to a lukewarm reception, with critics calling it a scheme for wealthy artists to get richer, tone-deaf in its appeal to would-be customers accustomed to streaming their music for free. Some even warned that it will lead to increased levels of music piracy — the opposite of the service’s intended outcome.

But the wave of new content Tidal pushed over the weekend may be enough to make some skeptics reconsider. With some of the biggest names in music premiering songs and videos exclusively on the service, fans may well decide that 10 or 20 bucks a month is a reasonable price to pay to hear the world’s biggest artists first and fastest.

Here’s what premiered on Tidal over the weekend:

Beyoncé, “Die With You”:

This new track from Beyoncé is stripped down and soulful, a sweet piano ballad that echoes previous singles like “1+1.” With heart-melting lyrics like, “Darling I wake up just to sleep with you,” the song dropped on Beyoncé and Jay-Z’s wedding anniversary, offering a viable alternative to the traditional gift of wool or copper associated with seven years of marriage, and finally answering the age-old question: “What do you get the rap mogul who already has a net worth of more than $500 million?

Rihanna, “American Oxygen”:

Rihanna’s new track isn’t only a dark rumination on the American dream — it’s also a thematic fit for the launch of the very service on which it premiered. Taken in the context of Tidal’s debut, the lyrics “We sweat for a nickel and a dime, turn it into an empire” reinforce the notion that even — and perhaps especially — the most successful artists got where they are through toil and sacrifice. “This is the new America,” after all — where quality music doesn’t come free.

Madonna, teaser for “Ghosttown” video:

The 16-second black and white teaser for Madonna’s “Ghosttown” video features capes, top hats, over-the-knee boots, trespassing and glimpses of something resembling Satanic ritual. The song offers a creepier take on the “I’ll Stand By You”/”Never Tear Us Apart” anthem of unflappable devotion, and the video looks as though it will follow suit. Because nothing screams fidelity like burning crosses and decomposing animal carcasses.

 

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