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Streaming Coming to a Jukebox Near You

July 28, 2015 by

Apple Music logoWith the arrival of Apple’s new subscription, all-you-can-eat music-streaming service, Apple Music, the music industry seems poised for yet another format shake-up. Following are some potential impact points and opportunities for the jukebox world…

Apple has sold well over 1 billion iOS devices to date. A significant number of the owners of these devices will opt-in to the $9.99 monthly subscription fee for Apple Music. Therefore, a much larger slice of the music-listening population is going to start consuming music via streaming.

Apple’s reported goal is to get 100 million paid subscribers on its books. Currently, the number of people streaming music via paid subscriptions of any kind is thought to be around 41 million. Unlike many of its competitors, Apple has the marketing muscle to achieve its goal, and the cultural clout to drive this behavior shift. Streaming will likely soon become the primary way people listen to music.

Spotify, SoundCloud, Rhapsody and YouTube already provide listeners with access to extensive music catalogs, but with the arrival of Apple Music the potential exists for a massive upscaling of these streaming models. The platform presents the opportunity for labels and music PR companies to take jukeboxes more seriously, if the jukebox can hook into Apple’s vast and growing ecosystem. Indeed, the music industry may beg Apple to integrate Apple Music into the out-of-home media experience.

With the mainstreaming of streaming, the journey from hearing a track on a jukebox to personally engaging with that track could become easier for a lot more people; they could simply click on it in their own Apple Music profile, save the track to a playlist, listen to more tracks by the artist or search information related to the track. As opposed to the traditional passive experience, a jukebox track could now link to an artist’s entire catalog on the most authoritative streaming service with the broadest reach in the world.

The jukebox would instantly carry more weight, because it would create an instant path between the current featured track and further engagement by the listener with that artist. Apple Music also creates a direct connection to listeners’ personal information that could be converted into winning marketing strategies.

As people warm to the concept of access as opposed to ownership, they will begin to expect that jukebox music be free to them. Increased access brings with it the perception of disposability: a track will be simply one of millions on Apple Music. It will still only be the true blockbusters that will attain the exposure required to transcend “commodity” status. However, listeners will exchange information, such as an email address and demographic profile, to gain access to a venue’s “pro version” of Apple Music. Offering people access and venue-specific features like an exclusive pre-release “sneak peak” in exchange for their personal information should yield much in the way of actionable data.

Labels and marketers will now look to be more creative about where and how they engage customers, and what they offer them in the way of access in exchange for valuable personal information. With Apple Music, more data on listening preferences and other behaviors will become available. And filtering will become much more automated and venue-specific. What the jukebox business does with the potential of this valuable functionality and data is a key question facing this segment of the out-of-home media market as it looks to the future.

With the advent of Apple Music, it is likely the number of paid streaming accounts will rise dramatically. Hence, revenue generated by this method of consuming music will continue to rise. It is also likely that a pro version of Apple Music would render current jukebox services obsolete, eliminating one hand in the revenue cookie jar. However, this will likely mean more revenue for Apple; an Apple Music Pro platform does not look likely to make operators rich anytime soon.

Savvy marketers will now begin to engage fans via Apple Connect, which Apple describes as:

“A place where musicians give their fans a closer look at their work, their inspirations, and their world. It’s a main line into the heart of music — great stuff straight from the artists.”

Apple Connect presents huge potential, and it would not be surprising, given the number of mobile devices upon which Apple Music will be pre-installed, for Apple to offer a professional version of Apple Music that is fully licensed and legal for public performance of the original sound recordings. This additional level of engagement with customers in a venue-specific environment would give Apple unique access to customers in a setting that is not duplicatable in another context.

Apple Music has an enormous interaction factor: it brings with it the potential to turn a listener who might casually hear and enjoy a song on the jukebox into somebody who engages with jukebox tracks more regularly, simply based upon access, familiarity and ease of use via their iOS device. The difficult part, however, will be turning that engagement into a financially beneficial arrangement for traditional jukebox stakeholders – particularly for the operator.

The jukebox business will have to creatively leverage the new potential of streaming to establish its unique value amid the cacophony of background music in the out-of-home world. In any case, with the advent of mass streaming the jukebox biz will have exposure to more customers in more places that are willing to share an unprecedented amount of information in exchange for access to favorite and emerging music. The jukebox business, like so many others, is increasingly a media business.

Categories: Blog, Jukebox