Op-Ed: Apple Music's Churn Rate – By Bob Lefsetz


It's 6.4% per month, which is three times that of Spotify.

And the hardest thing is to get people to resubscribe, it's like getting back together with an old love, you kicked the tires, you had some fun, but overall it just wasn't worth it, you're looking for something better.

If you're looking for something at all.

This is a music industry problem. The theory was that when Apple entered streaming it would burgeon and all problems would be solved. But it turns out people are tuning out. What now? Will they go to Spotify? Not right away. Because I'd posit a great number of Apple Music users signed up because of the ecosystem, they were Apple acolytes, they were entranced to check Apple Music out. They're not hard core music fans, and what they found was not enough to make them stick around. Turns out a me-too service with a bad user interface is just not that appealing.

So what will bring them back?

Certainly not exclusives. This is a false canard. Exclusives are about cannibalization, drawing Apple Music users from Spotify, theoretically anyway. What is the special sauce that will resuscitate Apple Music?

It doesn't exist, they blew it.

The mistakes were so many.

1. First mover advantage. As in Apple didn't have it. When Apple was late to the game with iTunes and then the iPod there was no dominant jukebox software and no dominant MP3 player. Furthermore, iTunes was EASIER to use and the iPod was too, as well as transferring files at a high rate of speed, i.e. via FireWire. What was the Apple Music breakthrough? Hand-curated playlists? Which some found inferior? Spotify toppled Rhapsody because of the free tier, because of higher functionality, the songs started right away and you could fast-forward and reverse easily. Spotify had a huge beachhead. Being Apple was not enough to triumph.

2. Usability. It's hobbled Twitter, which is similar to Apple Music in that people tried it out, were confused, and didn't come back. Navigation was near impossible. Supposedly the UI is now better, but you have to pay to check it out, most have already used up their free trial, they're happy at Spotify or not subscribing to any service, why would they come back? It's like buying a lousy car, an old Fiat, a Yugo, and then hearing they've fixed the problems and you should come back, but you don't.

3. Too much functionality. Putting files and streams in the same app is like putting word processing and spreadsheets in the same app. Imagine every time you opened Excel you got a Word document. And then you couldn't find your Excel files. This is what using Apple Music is like.

4. Broken upon launch. Really, you released an unfinished, bug-ridden product in an era where we expect everything to work right out of the box, both our flat screens and apps, in an era where there are no instructions and there is no tech help? That's just too much.

5. Jimmy and Dre. Stars are for entertainment, worker bees are for tech. The software is the star, not the creator, and in this case Jimmy and Dre were just front people, no one believed they could code, never mind navigate more than a browser. Sure, we know Zuckerberg and Bezos, but they earned their stripes, and they don't brag about how rich they are, and they're not about hobnobbing, but the work. Apple Music should be a functional product, not a creative one, and Jimmy and Dre and Trent Reznor have no experience in functionality, only hype.

6. Not an underdog. That's right, we like our upstarts, especially in tech. Apple Music was launched as a holier-than-thou product by a self-satisfied crew and the sneezers who spread the word on new tech wanted nothing to do with it.

So how does Apple Music get on the right track?

By establishing a free tier. That's it's only solution. It can't compete with Spotify without it. People need to be able to experience changes and improvements, otherwise they're never gonna switch. And the free tier should never expire. Because unlike free HBO weekends content is not the draw, functionality should be. You can't win via exclusives, they just piss people off. If Spotify can win without Taylor Swift and Adele, it can continue to succeed without the stars Apple Music might align. And the truth is stars hate exclusives, they only do it for the money. They're fan unfriendly, and they leave too many people out of the loop, and in an era where it's hard to reach everybody, you don't want to leave out anybody.

And there needs to be integration with messaging, so people can share tracks. Messaging is key in today's world, and Apple's got a huge head start with iMessage, but it's a walled garden, you can't play if you're on Android. But if you are on a competing platform you've got WhatsApp, and in China WeChat dominates. Apple needs to open iMessage for the opportunity to lock people into their ecosystem with new products, like Apple Music. Otherwise, it's a death march, the iPhone won't dominate forever, to the degree it dominates at all, because handsets have become a commodity.

And there needs to be a focus on the hard core user, it's they who spread the word. With a churn rate like this Apple Music has too many looky-loos, and they don't build a business.

As for innovation… There are a lot of new ideas, talent contests, earning placement on the homepage, but this would depend upon Apple's brass looking down, into the pit, to those coming up, as opposed to hanging with the fat cats, leaving the public out. Didn't Jimmy get the Brexit memo, that elites are abhorred? And out of touch too?

This is like digital cameras folks. As a matter of fact, 2016 is the year. Remember when we kept hearing that digital was gonna replace film and it didn't happen? And then, after a decade, it did, film died overnight. Files are dying and streaming is now going through the roof. And we know that one enterprise dominates online, one app or site has 70% of the market. Right now, that appears to be Spotify. Which has a head start, but is not perfect. Its look and feel are not its strong points. Apple could have made headway here, but it issued a half-baked product instead. Kind of like with the Watch, but at least that was a breakthrough compared to what was already in the field. And they're fixing the Watch. But convincing people to buy one, even more, convincing those who returned one to buy another? That's extremely difficult. Kind of like getting people to return to Apple Music.

"Apple Music has one big weakness in its fight against Spotify": goo.gl/27Bc9s