Streaming radio service Pandora recently announced the launch of a lower-priced interactive streaming platform, the result of its purchase of Rdio last year. Unfortunately, the launch might not have the result many in the music business are hoping for; while it will surely convert a handful of listeners who couldn’t afford the standard $9.99 USD per month price, it won’t move the needle in a meaningful way. That’s because the hardest jump for people to make is not from $5.99 to $9.99 -- it’s from zero to a penny.
With the announcement of Pandora’s partnership with Ticketfly to enable in-app ticket purchases, it appears that streaming services have started to realize that they can’t survive on music listening alone. Spotify has deals in place with Songkick and Merchbar, and other services will likely follow suit over the course of the coming year. While these steps are laudable and needed, they are only the tip of the iceberg. In order for streaming services to survive and thrive, as well as compete with one another, they need to greatly expand their commerce offerings.
As of right now, it looks like the age of the music streaming exclusive might be drawing to a close. While providing albums exclusively to one service might have led to a financial windfall for some artists, the resulting piracy and fan backlash proved to be too much for Universal Music Group, which sent out a decree declaring the end of the practice a few weeks ago. This is great news for listeners who want to stick with one service, but it also creates a new problem for artists -- in an age of declining album sales and advances, they need more sources of revenue. Music streaming services can no longer provide that, and brands can be the ones to step in and fill that role. If done well, branded album exclusives can provide a benefit for the artist, brand, and fans -- but done poorly, they can result in bad press and frustration.