Jimmy Iovine is ‘scared’ for the future of music
Jimmy Iovine is not a fan of freemium. At the Vanity Fair New Establishment Summit, the Beats 1 executive told audience members that he was afraid for the future of music, and criticized the business model of streaming services like Spotify.
Freemium services allow users to stream for free, provided they don’t mind listening to ads every third or fourth song. Users who upgrade to a premium tier can listen ad-free and enjoy other features like offline listening for a monthly fee. But Apple’s streaming service, Apple Music, diverges from competitors in that it does not offer a freemium tier. “If Apple had a free tier, we’d have 500 million people, but we don’t want to do that,” Iovine said. “We believe that we built something powerful enough and strong enough to work. Free is a real issue. This whole thing about ‘freemium’— maybe at one time you needed it, but right now it’s a shell game.”
Iovine spoke critically of how streaming platforms are building their audience size and market share “on the backs of artists.” Artists, he explained, are commonly convinced into putting their albums on streaming services, told that no one will pay for the entire album if it is withheld. Making money on tour often usurps financial investment and attention into another album. “The records are taking a back-seat to all the touring,” he said. “They should at least be equal, but they’re not right now. And that makes me really T’d off.” This cycle becomes dangerous, warns Iovine, because the best albums take more time and money to produce than this modern equation allows.
Apple Music is no stranger to the current debate surrounding this topic. Ahead of its launch, there was a planned royalty-free trial period that was very publicly contested on Twitter by superstar Taylor Swift; shortly after, Apple Music announced that artists would still be paid for the three months in which the service was free to users. Despite the public relations fanfare surrounding the decision, the equilibrium of how much artists should be compensated by streaming services has not yet been definitively determined.
Iovine’s outlook for the future of music – at its current rate – is quite dismal. “Music used to be No. 1 or No. 2 in most people’s hearts,” he said. “But if you said to a teen today, ‘Okay, you can only have two apps on your phone,’ neither one of them would be music. And that makes me scared. I have no research for that, but I can feel that from living everyday.”
Via: Business Insider