Subscription Music Market Taking Off as iHeartRadio Joins Mix
The subscription music market -- heating up with Pandora’s on-demand offering promised before year-end and its new Pandora Plus mid-tier service -- will get another high-profile contender in January. That's when two paid music services launch from iHeartMedia, said the company in a Friday announcement.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
IHeartRadio said it’s “reinventing live radio” with iHeartRadio Plus and iHeartRadio All Access, launching a replay feature that’s reminiscent of the one Pandora announced earlier in the month (see 1609210051) but tied to live radio instead. “For the first time ever, when listeners hear a new or favorite song on the radio they can instantly replay a song and even save it directly to a playlist,” said iHeartRadio President Darren Davis.
The company cited research saying 73 percent of consumers, including users of on-demand music services, listen to radio as their primary source of music discovery. The iHeartRadio’s on-demand service bridges the divide between music discovery and music collecting through interactive radio, it said.
As with Pandora’s upcoming offerings, all three major music labels -- Sony, Universal and Warner -- are on board. IHeartMedia also announced deals with independent record labels and distributors The Orchard, Entertainment One, INgrooves, DashGo, Naxos and CD Baby, it said. Sony Music Entertainment CEO Doug Morris said the deal with iHeartRadio creates “promising new commercial opportunities” to engage with its millions of listeners. Warner Music Group CEO Steve Cooper, said the new services will offer artists and songwriters a wider range of commercial and marketing opportunities.
In differentiating its offerings, the company said iHeartRadio Plus is designed to be “an addition to other on demand services, not as a replacement.” The iHeartRadio All Access service will “go beyond iHeartRadio Plus,” providing “a full on demand music collection experience -- but one still tied directly to radio,” it said. The company isn't ready to give pricing for either service, a company spokesman told us.
IHeartRadio reaches more than 250 million U.S. listeners each month through its broadcast stations and can drive “massive awareness,” it said. With the subscription services, it’s targeting the 84 percent of iHeartRadio users who don’t currently subscribe to an on-demand service but may want to pay for a service that combines on-demand functionality with a library of saved music. The service has 90 million registered users, it said. Recording-industry shipment results for first-half 2016 “illustrate the emergence of paid subscriptions as a primary revenue driver” in the U.S., RIAA said last week in its midyear report (see 1609200050).