Is this the Demise of Dr. Dre’s ‘Beats?’

We’ve been focusing quite a bit on live-streaming apps lately, and this week’s post is following that trend. Here’s a look at one of the more recent live-streaming services for music – Dr. Dre’s Beats.

You’ve probably heard about the latest Apple buzz by now: apparently the company might be getting into the streaming music business.  The rumor couldn’t have come at a better time for the company, because a year ago Apple paid $3 billion for Dr. Dre’s Beats Music business. They acquired the hipster headphone hardware and streaming music service, and you’d think that the purchase would be paying off.

Over the last year, however, online desktop and Android app traffic to the Beats Music service plummeted. For desktop users visits to the service were more than halved, dropping from 1.34 million weekly visits in January 2014 to roughly 270,000 per week in January and February of 2015.

Beats Jan 14 - Mar 2015


While percentage of installs of the Beats Music Android app remained steady, The app’s install rate has remained at 12% – 13% over the last six months, slightly less than Spotify’s growing 15% install rate, and dramatically less than Pandora Radio’s 43% install rate.Beats Spotify Pandora app install rates

User retention of the Android app also dropped from 55.5% of people on the first day of installation to just 4.6% after thirty days. That’s 68% less than Spotify’s 14.5% 30-day retention rate, and 77% less than Pandora Music’s 19.7% retention rate. The majority of people who installed the app weren’t staying around to continue using Beats Music service on their mobile devices.
Days Post installation - Beats Spotify Pandora

Given the apparent downward descent of Beats shortly after it was purchased, one has to wonder how this affect’s Apple’s plans. It remains to be seen whether Apple will formally launch a Spotify-like streaming music service built on the back of Beats Music technology. It’s possible they’ll re-launch a new version of the product, or maybe they’ll scrap it altogether in favor of rebranding for a fresh start.

Whatever happens, Apple still has some rough waters to navigate before they can start streaming smoothly. Another potential complication is that the U.S. Federal Trade Commission (FTC) is reportedly investigating Apple over antitrust issues.  The FTC is allegedly worried that Apple may be wielding excessive influence as the largest seller of music downloads to potentially put rivals like Spotify at a competitive disadvantage. According to Bloomberg, “[t]he FTC’s inquiry could complicate Apple’s planned revamp of Beats Music this summer.

About the Author -

Ari is the Sr. Director of Corporate Marketing at SimilarWeb. He has spent the last decade in ad-tech working on the agency side of the business before jumping over to Kenshoo where he launched their marketing activities. He also led the marketing for Adquant, a Facebook ad platform, making it a top 10 Facebook PMD prior to its acquisition.

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