If Apple does indeed reach a deal to acquire Beats Electronics and announce it this week as expected, the clock is once again counting down to offer up your take on the whole scenario before it’s actually official. Steve Jobs’ biographer Walter Isaacson got that opportunity earlier this week thanks in part to Dan Lyons of Fake Steve Jobs fame; Isaacson told Lyons he believes the expected $3.2 billion acquisition by Apple is all about creating a world class video service led by Beats’ co-founder Jimmy Iovine.
But when you think about Beats and what the company has to offer for Apple, the subscription music service launched by the company in January earlier this year comes to mind. Spotify, of course, dominates in this space as seen by the company’s announcement today that they now have 10 million paid subscribers and 40 million active users.
That severely dominates Beats Music which is believed to half less than a quarter of a million subscribers (although Spotify is about 6 years more mature than the Beats Music service).
Billboard today interviewed Daniel Ek, Spotify’s CEO and co-founder, and asked specifically about the expected Apple acquisition of Beats Electronics. When asked what the deal means for Spotify, Ek declined to offer much take considering the deal has yet to actually be announced by either party:
There has been a lot of people speculating on the news and what it means. I don’t know. I don’t like speculating about things that haven’t happened.
Ek did comment, though, when asked if Apple buying a streaming service would mean more people would support music subscriptions than before or if it would mean the two companies would just be more competitive for the same customers.
The one thing I can say – we know streaming is the better model in music and we’ve said that for over 5 years — when everyone else said it wasn’t the case. I’ve always assumed Apple would offer a streaming service at some point – but we’re focusing on building the best possible product and feel pretty good about that.
Ek went on to point out that Spotify is a single product focused on its music subscription service and expressed his view that people distinguish that between products that are bundled in with something else. Ek doesn’t come right out and say it, but it’s possible he’s referencing Apple’s iTunes Radio service which comes pre-installed with iOS 7 and iTunes 11.
Users know the difference between something that really is the best product and not something that’s just bundled in – and 10 million subs is a good indication of that. We’re not fighting over market share here. The music industry is still smaller than it should be. And in the UK, we’re seeing that streaming (and we) are already growing the overall pie.
Regardless of what plays out this week or thereafter regarding the expected Beats acquisition by Apple, the company that once dominated in the digital music space with iTunes is reportedly interested in owning its own on-demand music streaming service, á lá Spotify, though Beats Music could certainly play an interesting role in that venture.