By Minal Bopaiah
The streaming music industry is definitely experiencing some growing pains and adjustment problems.
Recently, The New York Times wrote about how the industry is struggling to find profitability,even though most streaming music sites and services are getting above-average conversion rates on subscription sales (from 4% to 25%!).
As my analysis detailed, the problem seems to lie in the music industry’s inability to understand consumer expectation and attitudes towards paying for music.
But it looks like Spotify and Rdio may finally be catching on. Both services recently announced decisions to go free online. Or, in other words, both are charging for ad-free experiences via subscriptions.
Rdio is presenting tiered subscription plans based on device type and the number of users.
Spotify, on the other hand, has one subscription price with multi-device access.
All in all, Spotify’s plan is probably wiser — because of video streaming sites like Hulu and Netflix, consumers are coming to expect multi-device access. However, Spotify could charge more for multi-user plans.
Interesting note: Spotify’s US plan is priced at $9.99, which is less than the £9.99 price tag for UK subscriptions. Which just goes to show — pricing has more to do with psychology than the cost of production. Our Pricing Toolkit can tell you more.
Finally, checkout our Paywall Optimization Toolkit to learn why Spotify has the better plans & pricing page.
