✔️ 2022-03-19 01:11:13 – Paris/France.
The Ledger is a weekly music industry economics newsletter sent to Billboard Pro subscribers. An abridged version of the newsletter is published online.
The music industry should monitor what Netflix done in some Latin American countries to generate more income as easily as possible.
In the next weeks, Netflix will start testing two new features in Chile, Costa Rica and Peru:
- "Add an additional member", which allows standard and premium plan subscribers to add up to two people they don't live with for a few dollars a month;
- And “transfer profile to new account” for people to take their profile information – namely their viewing history and recommendations – to a new account rather than creating a new account from scratch.
“We recognize that people have many entertainment choices,” the company wrote in the blog post announcing the new features, “so we want to make sure that all new features are flexible and useful for members, including memberships. fund all of our excellent television programs and films. " Certainly, Netflix offers carrots rather than sticks to manage account sharing between people from different households. Previous efforts to reduce password sharing have been delicately addressed. Contrary to some headlines, Netflix does not exactly address the problem. But with subscription growth slowing and its share price falling, Netflix don't ignore the question either.
What does this have to do with music subscriptions? Many. People share accounts with Spotify, Apple Music, and other music subscription plans just as they share accounts with video subscription services. Music services are also under pressure to generate more revenue for rightsholders and creators. Spotify chose to experiment with small increases in multi-user subscriptions such as family plans rather than large price increases. Instead, Spotify et al. focused on attracting more subscribers, which leads to more paying customers streaming music, and reducing churn, which increased average subscriber lifetime value. Overall, prices have remained stable for over a decade.
According to the MusicWatch Annual Music Study 2021. This was down from 18,6 million in 2020, but up in 2018 (9,2 million) and 2019 (12 million). MusicWatch's previous survey in 2019 found that roughly one in nine Americans using a music subscription were streaming using someone else's password. About 30% of people who admitted to using someone else's password said they would pay for the service. This segment would be worth $300 million per year at $9,99 per month – even anything less would be an opportunity to convert non-paying users. The remaining 70% of account sharers said they would opt for the free, ad-supported version. It is also an opportunity. The services of Streaming and rights holders would be better off if they could pay a few dollars a month rather than become low-value ad listeners.
Improving monetization does not require widespread and unpopular price increases. Small tweaks can help grow the market and convince more people to become paying customers. The option of Netflix transferring a profile to a new account eliminates some of the pain of starting an individual subscription. If a service of Streaming musical followed suit, a person could sign up for a new subscription and keep all their playlists created under a previously shared account. Giving non-family members the ability to join a shared account would result in slightly higher revenue per user without everyone paying more.
The services of Streaming musical are under increasing pressure to provide more royalties to creators and rights holders. Tackling account sharing is a smart option. Even gentle nudges, not harsh tactics, can produce results.
STOCKS
Until March 18, the % change over the last week and the change since the beginning of the year.
Spotify: $144,78, +16,5%, -38,1% since the beginning of the year
Universal Music Group: 22,78 euros, +11,7%, -8,1% YTD
Warner Music Group: $37,21, +17,0%, -13,8% since the beginning of the year
Believe: 12,90 euros, +11,3%, -23,7% YTD
tank media: $8,96, +8,7%, +13,3% YTD
nation live: $112,98, +4,1%, -5,6% since the beginning of the year
Tencent Music Entertainment: $5,06, +47,1%, -26,1% since the beginning of the year
SOURCE: Reviews News
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