Jimmy Iovine has some pretty direct words for where he thinks Apple Music is currently.
“I don’t believe that what exists right now is enough.” Jimmy Iovine, who runs Apple Music — originally Beats, the music service and electronics business that he and co-founder Dr. Dre sold to Apple for $3 billion in 2014 — is on a tear about the deficiencies of streaming services, including his own. Sitting on a couch in his sunny office at Apple’s Los Angeles headquarters, he admits he wouldn’t be here if he weren’t “extremely” optimistic: “I believe we’re in the right place, we have the right people and the right attitude to not settle for what exists right now.” But ultimately? “Just because we’re adding millions of subscribers and the old catalog numbers are going up, that’s not the trick. That’s just not going to hold.”
Apple Music tells Billboard that it now counts well over 30 million paying subscribers, helping fuel a 17 percent revenue jump for the U.S. recorded-music business in the first half of 2017 over the same period a year ago, according to the RIAA. Meanwhile, Goldman Sachs issued a report in August predicting that subscription streaming would drive the global record business to nearly triple to $41 billion by 2030.
The world that is and the world that must be.
Apple, which has about 800 million iTunes customers around the world, has more levers to pull: The company recently started promoting Apple Music subscriptions more heavily through ads (one coming in October will feature Lena Dunham) and on its iTunes Store, where it began selling 99-cent singles in 2003. (Music downloads have been plummeting steadily since 2013, down 24 percent in the first half of this year in the United States, according to the RIAA.) It has been spending seven-figure sums to secure exclusive rights to more than a dozen documentaries on artists from Harry Styles to Diddy, some of which have garnered more than 500,000 first-week views, on par with HBO’s premiere of Beyoncé’s Lemonade, a source tells Billboard. And Iovine, Lowe and Jackson are hoping to funnel more paying fans in through Beats 1, a live feed that’s free because it doesn’t offer songs on demand. The trio is also hoping for changes to the way Billboard calculates its charts — where a free stream on YouTube counts equally to a paid stream on Apple Music — which could incentivize artists and labels to promote their music on higher-paying platforms, rather than racking up free streams to win the No. 1 slot. The three men spoke with Billboard last week about, as Iovine puts it, “what streaming has to become.”
Read the entire, and fascinating, conversation here.