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As Subscription Streaming Dominates Revenues, Free Music Is Coming Under Pressure


Recent comments by Sony Music CEO Rob Stringer underscore the importance of subscriptions as free, ad-supported services lag in value creation.

The next month, CEO Daniel Ek listed “superfan things” — as well as audiobook sales — among the products Spotify could offer if Apple did not take a 30% cut of in-app purchases. In April, Michael Nash, Universal Music Group (UMG) executive vp of digital strategy, said during the company’s earnings call that internal research suggests 10% to 20% of subscribers would be willing to pay extra for a “super premium” tier. And between additional price increases and possible superfan tiers, combined with overall weakness in ad-supported streaming, subscriptions are poised to command an even larger share of the industry.

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