Tatiana Simonian, a vice president at Nielsen, gave a presentation at the EDMbiz conference. During the talk, she shared two slides from the Nielsen Music 360 report with data about the industry.
The Nielsen data asked its survey respondents who said they paid for streaming which services they spent on. The results showed a larger percentage of paying customers at Pandora One and Spotify, where 33% and 32%, respectively, currently subscribe to the service. The next closest service is Rhapsody, with 14% paying for a subscription. For all other profiled services outside of those top three, at least 80% of the respondents have never paid for the service. That includes Google Play, Rdio, Beats Music, Xbox Music, and Sony Music Unlimited. Across streaming listeners, only 5% on consumers pay for streaming.
This slide also showed an interesting data point about retention. Pandora One has the highest proportion of paying customers, but it also has the highest rate of people who discontinued their paid membership at 18%. Spotify had 13% of listeners ending their paid tiers. The other services had less than 10% discontinuation.
The second slide was one that we’ve seen a few times already; it was part of Nielsen’s 2014 industry report as well as the Music 360 study. But this version attached dollar values to the previously reported percentages. Annual spending on online music streaming for an average person is just $3.60. The low amount, less than a single month’s subscription to the average streaming service, further reenforces the low percentage of listeners who have committed to paid tiers.