Beats Music, reportedly acquired by Apple, has just 110,000 paying subscribers

A royalty report leaked to music blog Trichordist (via The Guardian) shows that Beats Music, the streaming service linked to Beats headphones, has just 110,000 subscribers as of March. Since its US launch in January, the service has added 61,621 family accounts (which can stream music on up to five devices) and 49,371 single-user accounts.

As AT&T offers a 90-day trial when you sign up to Beats Music on an AT&T device, it is unclear how many of these users are actually paying the $9.99/month for an individual account or $14.99 for a family account. It is worth noting that these figures predate the addition of an in-app purchase option on iOS. It is also worth nothing the engagement of users: 116.4 million songs were played by the 49,371 individual subscribers which is roughly 76 per day. While Spotify or Rdio do not release such numbers, it is safe to say that these numbers are very higher and show that the customer base is very loyal to the service. 

The royalties paid by Beats Music are also very small compared to industry standards, with artists receiving just $0.000126 per song. In comparison, Spotify pays $0.006 and $0.0084 per play. The low royalty rate juxtaposes the claim that Beats Music is artist-friendly.

Source: Trichordist (via The Guardian)

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Me too, record player + the original klipsch cornwall's mmmm.

I used to have a set of beats headphones the wife bought me. They really are great depending on the type of music (heavy bass). Sounded great for my reggae, not so great for my classical.

I will straight away canned someone who came up with the idea of acquire beats with that price.

The iPhone R&D never cost that much and it's hard to accept now they have to spend over a billion that barely consider a game changer to supercharge their product.

How is this acceptable if you're a shareholder.

anothercookie said,
It sure gets them a hell of a lot of advertising out o the deal.

The beats headphone isn't a breakthrough product like the iPhone or iPad and spending that amount of money even sounds more ridiculous.

If you think that's a great deal in exchange for advertising then the beats have to be really superb like the mac and it isn't even in the same league.

They can save that money to develop a better headphone than beats.

All I can say is its not what beats has now but what apple will make them. Apple is making a great move doing this and of you dont see that then your a blind fanboy or a hater. I wish Xbox music interface looked as sweet as beats and if beats allowed you to buy music and managed my music I would leave Xbox music in a second. This is my last year with Xbox music and I've been a subscriber for over 5 years.

mrp04 said,
The last paragraph seems to be why Apple purchased them. Insanely low royalties.

Yes, but that would only benefit them until that came up for renewal or renegotiation...

My money's on patents as well.

mrp04 said,
The last paragraph seems to be why Apple purchased them. Insanely low royalties.

How did they get so low of royalties? That is nuts...

FloatingFatMan said,
Do Beats have some patents Apple wanted or something? Because I can't for the life of me see why Apple would buy them otherwise...

I'm confused about it myself. It almost seems like they just wanted to scalp Jimmy Lovine because of his music industry contacts and knowledge, and getting Beats Audio is just a consequence of that.

All we can do is wait and see. It really doesn't seem like an acquisition that would have been made under Steve Jobs though.. so will be interesting to see how it pans out.

Chicane-UK said,

It almost seems like they just wanted to scalp Jimmy Lovine because of his music industry contacts and knowledge, and getting Beats Audio is just a consequence of that.

What's weird is... Apple has been dealing with the music industry for 11 years.

Shouldn't Apple have made some industry contacts and gained knowledge by now?

FloatingFatMan said,
Do Beats have some patents Apple wanted or something? Because I can't for the life of me see why Apple would buy them otherwise...

My guess is they have so much extra money. buying beats is better than putting it in trash. and they get some Tax ride off.

Michael Scrip said,

What's weird is... Apple has been dealing with the music industry for 11 years.

Shouldn't Apple have made some industry contacts and gained knowledge by now?

Indeed. It's all very strange.

Apple paid $29,090.91 / user and each of those users will need to subscribe for 242.67 years until that is paid off. And that does not take into account the expenses. Go Apple!

$3,200,000,000 / 110,000 users = $290909.0909090909/user
$290909.0909090909/$9.99 month = $2912.0029120029120029120029120029 income/month/user
$2912.002912002912002912002912002 / 12 months = 242.66690933357600024266690933358 years

OK, so I rounded off by 0.01690933357600024266690933358 years, but not fuzzy at all. The topic was about how many paying subscribers Beats has, Apple paid $3.2B.

Edited by zhangm, May 13 2014, 8:32pm :

JHBrown said,
Guys, give it a rest already. We know you don't like Beats.

Ultimate Ears 900, Sennheiser IE80, Klipsch Image X10i - any of those are good. Beats is a joke.

cuppa.joe said,

Ultimate Ears 900, Sennheiser IE80, Klipsch Image X10i - any of those are good. Beats is a joke.

I like mine. I think they're great.

stevan said,

I like mine. I think they're great.

If they work for you good. I prefer to hear music in a good way. And no, I do not use compressed MP3.

JHBrown said,
My point was, why come in every Beats news article to proclaim how inferior the product is?

I have comments in two different articles. I used to read NeoWin years ago, but followed a source link on another site and thought I would comment. How is that commenting in every article how inferior the product is? And even if I was commenting in each article, so what? I see people going into every Microsoft article and posting multiple top level comments that are negative about Microsoft. Are negative Microsoft opinions the only ones permitted?

cuppa.joe said,

I have comments in two different articles. I used to read NeoWin years ago, but followed a source link on another site and thought I would comment. How is that commenting in every article how inferior the product is? And even if I was commenting in each article, so what? I see people going into every Microsoft article and posting multiple top level comments that are negative about Microsoft. Are negative Microsoft opinions the only ones permitted?

Hey Joe, I was not specifically talking about you. In general, if someone likes a Beats product, they are crucified. I don't own a pair, I just don't understand why people have to go in and attack a product when there are actually millions who enjoy using it.

stevan said,

I like mine. I think they're great.


not every one's ears are capable of perceiving all frequencies. If you like it good for you. but I trust people with good ears.

trojan_market said,

not every one's ears are capable of perceiving all frequencies. If you like it good for you. but I trust people with good ears.
So are saying he has bad ears? Come on now guys.

trojan_market said,

not every one's ears are capable of perceiving all frequencies. If you like it good for you. but I trust people with good ears.

True. But I like that I'm in the majority with this one. Self proclaimed audiophiles are everywhere. They need to rub these things into everyone's face so that they can justify their uber-expensive amps which in the majority of cases are useless.

JHBrown said,
Hey Joe, I was not specifically talking about you. In general, if someone likes a Beats product, they are crucified. I don't own a pair, I just don't understand why people have to go in and attack a product when there are actually millions who enjoy using it.

The reason is that the price of the headphones is extortionate for the quality of product you are getting. They use cheap components, jack up the price and sell it. The way they are able to do that is to make you think they're cool and high quality by putting "by dre" on the end of the product title. That just seems like taking advantage of people who don't know any better to me and that's why I don't like Beats.

I went to get some a while ago. Luckily the shop had others next to them to test. After hearing the difference I know now why they have the reputation they do. That said they are the best looking on the market which I think is more why they appeal.

I'm not a fan of Beats and IMO they're over priced. But they are meant for Hip Hop, Reggae and such. And for those genre's, they're pretty good for their price-range. Even for most electronic music they work fairly well.

And I've used a few laptops with Beats speakers and must say, they impressed me quite a bit. It surely beats 9 out of 10 laptops I've ever encountered.

Shadowzz said,
I'm not a fan of Beats and IMO they're over priced. But they are meant for Hip Hop, Reggae and such. And for those genre's, they're pretty good for their price-range. Even for most electronic music they work fairly well.

And I've used a few laptops with Beats speakers and must say, they impressed me quite a bit. It surely beats 9 out of 10 laptops I've ever encountered.

^