Jun 11, 2019

The music business moves into the streaming era

Reproduced from IFPI Global Music Report; Chart: Axios Visuals

Apple is killing its famous iTunes app on the Mac in favor of three new apps this fall: one for music, podcasts and TV.

Why it matters: The move is a symbol of the way music consumption has changed, moving from digital downloads to on-demand streaming.

The big picture: Over the past year, Apple has aggressively pushed users away from iTunes in favor of Apple Music, which has grown to reportedly surpass Spotify in U.S. users.

  • Analysts don't expect Apple Music to make tons of money, as licensing and label and publisher payout fees are expensive.
  • The music streaming service will likely strengthen the value proposition for Apple's hardware relationships, just as Amazon's music service is meant to strengthen its retail business through stronger consumer relationships.

Between the lines: The industry has developed standards and benchmarks for popular music around album sales and downloads.

  • The New York Times reports artists like Taylor Swift and Travis Scott are trying to bundle free downloads with ticket or merchandising sales in order to game the Billboard 100 list.
  • Billboard changed its methodology last year to weigh streaming success more heavily in its calculations, but the now widespread practice of bundling free downloads with merchandise and ticket sales is putting pressure on the group to readjust its calculations.

What's next: The music business is still trying to figure out how artists will be compensated for streaming success.

  • Some artist advocates have urged Apple not to cut off downloads entirely, as they provide a way for artists to get paid.

Go deeper: What Apple knows about you

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Traders work on the floor of the New York Stock Exchange. Photo: Scott Heins/Getty Images

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Why it matters: The stretch of declines came after a spike in coronavirus cases around the world earlier this week. The steep losses prompted questions about the fate of the record-long economic expansion, as well as a rare statement from the Federal Reserve.

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Federal Reserve chairman Jerome Powell. Photo: Sarah Silbiger/Getty Images

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Why it matters: The Fed rarely issues statements like this outside of policy meetings and scheduled public appearances. It came as the stock market continues its steep decline this week. Stocks briefly pared some losses after the 2:30 p.m. EST statement came out.