From left: Jen Walsh, Schusser and Rachel Newman photographed on July 17, 2019 at Apple Music in Culver City, Calif.
From left: Jen Walsh, Schusser and Rachel Newman photographed on July 17, 2019 at Apple Music in Culver City, Calif.
Yuri Hasegawa

Apple Music's Next Era -- And the New Leader Spurring Global Growth

“You hear Tim talk a lot about humanity -- how we’re at the crossroads between the liberal arts and technology,” says Oliver Schusser. “It’s got to be both.” The new leader of Apple Music (the Tim in question would be his boss, Apple CEO Cook) is relaxing in his sun-drenched corner office at the company’s Culver City, Calif., headquarters on a June morning, explaining -- in his typically measured way -- why the service he oversees hasn’t gone all-in on algorithms. “That’s just not the way we look at the world,” continues Schusser. “We really do believe that we have a responsibility to our subscribers and our customers to have people recommend what a playlist should look like and who the future superstars are.”

Executives both inside and outside Apple often describe Schusser as “very German.” Like a Teutonic Barack Obama, he balances an unflappable calm -- and an apparent inability to say anything controversial -- with an impressive mastery of detail, in this case the inner workings of Apple Music. Dressed unassumingly, in a black tracksuit and sneakers, he hardly seems like one of the most powerful figures in the music business.

A veteran of German media giant Bertelsmann -- first BMG and then Napster, when the company invested in it -- Schusser spent 15 years at Apple building iTunes’ international operations from the ground up. He took charge of Apple Music 15 months ago in an expanded role as Jimmy Iovine shifted to a consulting role and Robert Kondrk, who ran the business side, moved to product and design. At the time, the company was at a crossroads. During his three-year tenure, Iovine quickly built Apple Music into a serious competitor to Spotify, locking up exclusives from Drake and Chance the Rapper to turn it into the go-to streaming service for hip-hop and setting it up to become the biggest music service in the United States, which it did late last year.

While Apple Music was thriving on the outside though, there was strife within the company. Despite having nearly $250 billion in cash on hand, Apple always had focused on executing quietly, on time and on budget. Iovine, the old-school music executive, spent what, sources say, some in the music division considered an excessive amount of money on exclusives, music videos and documentaries. A rift arose between his acolytes and Apple traditionalists.

As vp of Apple Music and vp international content for Apple, Schusser took on an arduous task: running the company’s most important online service at a time when iPhone sales are slowing and the company’s online businesses are becoming increasingly important. (In addition to Apple Music, his purview includes iTunes, the App Store, Apple Books and podcasts.) At home in Apple’s culture, Schusser was expected to bring a global focus to the division, along with some much-needed structure. “We’re looking at this as a business,” he says, “and we look at our numbers in a serious way.”

Weeks after Apple Music’s fourth anniversary, and with well over 60 million paying subscribers, the service is in as strong a position as ever to challenge Spotify -- which has 100 million paying users -- as the biggest paid music streaming service. And with his low-key, efficient approach, Schusser has -- as nearly two dozen sources inside and outside Apple who were interviewed for this story put it -- dissolved the internal divide of the Iovine era and stoked a renewed energy.

“He’s a partner, a great listener and a champion of innovation,” says Jen Walsh, senior director in charge of Shazam and Beats 1. One former colleague notes Schusser’s instinct to help his team in any way possible, even when that means pitching in with tasks far below his pay grade, like setting up for events or getting coffee for visitors. Simply put, as one label executive says, “he’s the grown-up” that Apple Music needs.

But Schusser also faces a unique challenge. It’s a new era for Apple -- one in which services will sell its hardware, not the other way around. And for his tenure to be successful, Apple Music will need to grow in markets where the iPhone isn’t dominant, in places where iTunes never found success and in countries where consumers aren’t used to paying for music. Apple Music is growing faster than Spotify, both domestically and globally, but its momentum has slowed somewhat, according to sources with knowledge of both companies. While Schusser insists he’s not consumed with boosting subscriber numbers (“We just want to be the best; that doesn’t have to be the biggest”), he can’t ignore the Swedish juggernaut’s willingness to put powerful algorithms behind every playlist to keep its users returning.

Whether Schusser will be able to lead with the same deftness when Apple Music needs to innovate rapidly remains to be seen. “They need a visionary, and you wouldn’t accuse Schusser of being a visionary,” says one music executive (who, like most interviewed for this story, declined to be named -- it’s still common for those within the industry to fear reprisal from Apple for speaking publicly about it). But Apple had its time with a visionary in Iovine; now it needs someone who can shape that vision. Schusser, who essentially wrote the playbook on international growth of online music services, could well be the right person at the right time.

 


 

Down the hall from Schusser’s Culver City office, Rachel Newman, Apple Music’s global senior director of editorial, is reflecting on how her boss transformed things for the better in just over a year. “He knows more about most people’s teams than they do themselves, in a good way,” says Newman, who, like many Schusser appointees, is an Apple native -- she ran iTunes, the App Store and Apple Books in her native Australia and New Zealand for nearly a decade. “He knows people’s birthdays. He just has the capacity to deal with the human side of being a leader, as much as he does the strategic and commercial sides. That is what makes him phenomenal.”

Schusser has been part of the digital music revolution from its inception. In the late ’90s, as an excutive at BMG, one of his first projects was to write a memo explaining “what an MP3 is,” he remembers. “So really early on, I became very interested and involved in digital music.” He joined Bertelsmann at a pivotal time, when it had recently made a deal to loan Napster money to build a subscription service. “It was in the days when they were running into legal trouble and were shutting down the service,” recalls Schusser. Later, he went to Napster as a vp during “the heyday of the Silicon Valley digital economy. I loved it, but it was too early. It didn’t work.”

He moved back to Germany to work for Vodaphone, “at a time when all the carriers thought they were going to be the distributor of music in the future,” and ultimately joined Apple (with the help of a few Napster-era connections) in 2004. “When [Apple senior vp internet software and services] Eddy Cue wanted to expand to Europe,” says Schusser, “someone gave him my phone number. I took the job immediately.”

For the next 15 years, Schusser spearheaded iTunes’ international growth (including starting the iTunes Music Festival in the United Kingdom) from Apple’s London office. By last year, when he got the call to take over Apple Music, he had been involved in major product decisions surrounding all of Apple’s music initiatives for years. “He helped make Apple a presence in the artist community in Europe, and he’s very respected for the way he has worked with labels on artist projects and new releases,” says Thomas Hesse, the founder/CEO of JAMM Music who worked with Schusser as president of global digital business at Sony Music.

Schusser first endeavored “to plan our editorial a little better, to look at our playlist strategy, the look and feel, the brand,” he says. He installed a group of trusted confidantes to lead new initiatives throughout Apple Music and launched editorial, artist relations and music publishing divisions to take better advantage of Apple’s long-standing artist relationships. In addition to Walsh, Newman and Tracey Hannelly, senior director of international for the App Store, he promoted Beats 1 hosts Ebro Darden and Zane Lowe. Darden runs Apple Music’s global hip-hop and R&B initiatives; Lowe leads a new artist relations team with fellow global creative director Larry Jackson, an Iovine holdover many didn’t expect would stay after his boss’ departure.

Last summer, Schusser shifted the service away from Apple’s traditional yearly update cycle (typically when the latest major iOS update is released in September) into a more consistent rhythm, launching top 100 charts and new personalized playlists in the past year. Despite the company’s historically selective attitude toward partnerships, it has struck deals with companies including American Airlines, Verizon and Amazon that put Apple Music in front of more potential customers than ever. Last December, Apple Music became available on Alexa, and in January, it partnered with Verizon to make the service free for customers with certain unlimited cellphone plans.

During the past nine months, Apple also has redesigned or rebranded many of its playlists as it prepares to make them more of a focus. Rap Life, for example -- a revamp of The A-List: Hip-Hop, one of Apple Music’s best-performing playlists -- will be featured daily during segments on Darden’s Beats 1 show and weekly on a series highlighting its music. “We’ve got to continue to put [artists’] music in front of the biggest possible audience,” says Newman. “We would be doing them a disservice if all we did was lean into their body of work.” While Apple Music still believes culture, not algorithms, will win, Schusser says the company is also “actively looking” at increasing the number of its personalized playlists.

So far, the labels seem to approve of the changes he’s instituting. “The label relations team has been going to the labels and presenting the changes so they really understand what changed and how,” says Schusser. Multiple label sources praise his guiding hand, noting that the company is now more open and engaging.

“Oliver continues to be a tremendous partner and friend who has brought a broad global perspective to the role,” says Michael Nash, executive vp digital strategy at Universal Music Group. “He has expanded Apple Music’s culture of creative experimentation while building upon its strong track record of collaboration with labels and artists.”

Schusser also has cut back on what wasn’t working. Eight months into his tenure, Apple Music shut down music-based social network Connect, one of the three key features touted in 2015 at the company’s Worldwide Developers Conference -- and widely considered its biggest failure to date. “We’re not a social media platform,” says Newman.

From the outside, it seems that Beats 1, too, hasn’t quite lived up to the expectations that surrounded the global radio station, but Schusser challenges that notion. “We don’t wake up in the morning thinking, ‘We want to be bigger than whatever radio station,’ ” he insists. “That has never been the intention.” Instead, Beats 1 is focused on being a place where acts can both market their work and speak freely. “Artists want to be able to control when their stuff goes out,” says Lowe. “Our job is to say yes.”

 


 

Apple Music made its name as the industry’s true artist-first service -- one that would give acts a platform to express themselves authentically, as on Elton John’s Rocket Hour and Nicki Minaj’s Queen Radio. That was the premise for Beats 1, and it’s still a key reason that artists don’t chastise Apple like they do Spotify. In early March, Apple Music further set itself apart from its competition when it decided not to appeal the Copyright Royalty Board’s ruling to increase the royalties streaming services pay to songwriters, publishers and performing rights organizations by roughly 5% -- which Spotify, Amazon, Pandora and Google all contested.

“We’ve always believed -- this goes way back -- that the most important thing is to pay artists and everyone involved in the process fairly,” says Schusser. “We have always considered the songwriters to be a key part of making the art, so we have historically paid the songwriters more than maybe an industry average. We still believe that today.”

Does respect for creators translate into customer growth? Perhaps -- part of the reason Apple Music came to dominate hip-hop (it routinely beats Spotify in first-week streams of the genre’s albums) is that its early exclusives drew die-hard rap fans who seemingly haven’t left the service. “Early on -- and Jimmy was a big driver of this -- we saw that hip-hop was going to be as big as it is in streaming,” says Schusser, “and we sort of overinvested.”

That focus on embracing creators is already paying off internationally too, in countries like Russia and Japan, both of which are among Apple Music’s top five markets. “We’ve worked really closely with local artists, labels and management companies,” says Hannelly of Japan in particular, where, says Schusser, Apple Music is “the leading service with quite a large distance.” Latin and K-pop are also priorities. “We’re seeing Latin urban music especially performing incredibly well in markets that normally or historically hadn’t been huge Latin music markets,” says Jennifer D’Cunha, head of Apple’s U.S. Latin business.

The majority of Apple Music’s subscribers are now outside the United States, says Schusser, but it still lags Spotify in many countries. As streaming conquers Europe and America, the opportunity is shifting to emerging markets (Asia, Africa, Latin America) where Apple hasn’t traditionally been as dominant as it has in Western countries. “The industry hasn’t quite figured out the answer for emerging markets yet, in terms of willingness to pay and pricing models,” he says. “When I say that, it’s the labels too.”

For now, Schusser is optimistic about the future, given how far Apple Music has come since it launched in 2015. “It has been four years, and we’re feeling really good about where we are,” he says. “Other people have had a lot more experience, a lot more time to test things and to learn, and we’ve caught up really fast. We look at ourselves as an artist-first company, and we want to be the best partners for labels, publishers and songwriters. We’re working with the product and engineering team on our vision and the future for the product. If you do all of these things, the rest will follow.”

This article originally appeared in the July 27 issue of Billboard.


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