The shift from ownership to digital streaming as the standard listening experience for consumers kicked into high gear in 2015, with worldwide revenue for the top 10 music-streaming apps more than doubling -- they were up 120 percent -- from 2014 totals. According to app store monitor App Annie’s annual report, Spotify made big gains as the worldwide leader in revenue and users for both iOS and Google Play, and ranks No. 1 in many regions.
In terms of active users, Spotify trailed homegrown streaming apps in several territories, including the United States (Pandora), China (QQ Music), France (Deezer) and South Korea (MelOn). But in Australia, Brazil, Canada and large swaths of Europe, Spotify was king. (The report excludes pre-installed apps, so Apple Music is not factored into the rankings.)
“The decline in digital music sales (i.e., paid music downloads) is a trend that will most likely continue in 2016 as more and more users transition to streaming services,” the report states. “In addition, music streaming is likely to receive another boost as underpenetrated markets such as Japan finally reach a tipping point.”
The U.S. mobile app economy also saw a shift in power rankings -- annual downloads on Google Play surpassed those on the iOS App Store for the first time. In the U.S., Google Play’s share of downloads increased from 45 percent in 2014 to 55 percent in 2015, with game downloads driving a significant portion of the change. In the U.K. that share rose from 40 percent to 45 percent year-over-year. Globally, Google’s lead over Apple in terms of downloads rose from 60 percent to 100 percent, thanks to advances in emerging markets including Brazil, India and Indonesia. With Apple devices being far more expensive than low-cost Android phones, Google Play’s dominance in the developing world should be stable.
Downloads are one thing, but raking in cash is another, and the report states that Apple still holds a commanding lead in the revenue department both in the U.S and globally. “Google must continue to evolve its strategy to help drive more revenue for its developers,” according to the report, which also warns that the U.S. market may be saturated with smartphone subscribers. “From smartphones and tablets to watches and TV accessories to AR and VR and device categories yet to be released, one thing we can definitely count on is that the U.S. will remain a massive and growing opportunity for app developers.”
Even with the growth in music app revenue, the report’s findings show they are dwarfed by other app categories like dating and video streaming. It should be noted, however, that there are more players in those categories while music is a much more concentrated industry, with Spotify and Pandora as Nos. 1 and 3 in worldwide revenue.
The report breaks down the top apps of 2015, combined iOS and Google Play revenue:
3. Pandora Radio
4. HBO Now
6. LINE Manga
7. LINE PLAY
1. Pandora Radio
3. HBO NOW
8. Sing! Karaoke
9. MLB.com At Bat
The report also lists the top app companies outside of games:
3. InterActive Corp (Match.com, Tinder)
5. Time Warner
6. Smule (Sing! Karaoke)
10 Baidu China
4. Time Warner