Apple iRadio will fail to attract mainstream attention or profits, if the preceding competition is any indication. Pandora has spent a decade losing money. Spotify keeps having to borrow from its investors. Napster 2.0, Lala, Real Radio and others have similarly failed to find a balance between baiting customers with money-losing free streaming music in the hopes of turning enough of them into paying customers to keep the lights on.
The royalty and bandwidth costs have eaten these companies alive, and while some of them, like Pandora, have found a modest degree of popularity, they’ve been on life support all their lives. Here’s a highlight reel of some of the worst streaming music subscription failures and what Apple can learn from them with iRadio.
Pandora: the closest thing in the music streamer market to a success, simply because it’s a survivor. Turned some heads when it notched a profitable quarter but has since sunk back into mounting losses. Unwittingly demonstrated that if you offer free limited and paid unlimited options, nearly everyone will choose the former. Never has been able to put together enough of an advertising market to make its free version pay for itself. Apple is attempting to pay for the free version of iRadio by resurrecting its iAd network.
Spotify: the geeks who touted it ahead of its American launch swore that it had already become mainstream in Europe, which turns out to have never been true. Tried using the invite-only launch scheme that Google made popular, didn’t work. Loses money hand over fist, keeps tapping investors like Justin Bieber for more cash. Doesn’t offer preprogrammed channels so much as it expects users to go in and find the music they want, build playlists, and listen to them on a stream. Caters to a proactive music streaming market which, as it turns out, doesn’t really exist. If Apple has any sense with iRadio, it’ll do everything differently than Spotify.
Read More: stableytimes.com