The music subscription business meets the ticketing business is the latest effort to gain an upper hand in the hyper-competitive streaming marketplace. The innovative deal, seemingly unique in the world of music subscriptions and ticketing, pairs Rdio with the three-year-old ticketing arm of AEG, the country’s second-largest concert promoter behind Live Nation, owner of ticketing powerhouse Ticketmaster.
Buyers of tickets on AEG’s AXS ticketing platform will have the opportunity to sign up for a free 30-day trial of the Rdio Unlimited subscription service. If the consumer wants to extend the service beyond 30 days, Rdio can be purchased through integrated billing with AXS. While Rdio is currently available in 85 countries, its partnership with AXS covers only the United States.
Rdio CEO Anthony Bay says this multi-year “economic relationship” is a sensible partnership for the company given the overlap of the companies and their customers. “Who’s the most qualified subscription buyer? Somebody spending money on music and events,” says Bay.
How to get new customers is the subscription music marketplace’s billion-dollar question. Services frequently partner with mobile carriers to provide in-carrier billing, bundled services, free trials or other offerings to reach potential customers. Sometimes partnerships, like Spotify’s integration with the mobile app of ride-sharing service Uber, doesn’t have a clear direct impact on customer acquisition. With Rdio’s deal with AXS, on the other hand, the potential is more obvious. “We think we’ll be better off financially,” says Bay.
The partnership also creates a sort of “Internet of things” user experience that merges online and offline activities. By linking data — similar to what Rdio does with Shazam — Rdio will personalize AXS users’ accounts based on prior concert purchases. There is room for additional features as well such as setlists and “probably exclusive content,” says Bay.
Partnerships such as this could provide additional momentum to an already fast-growing streaming market. In the United States, on-demand audio streams — activity, not revenue — tracked by Nielsen Music jumped 60.5 percent. Elsewhere in the world, streaming revenues grew 38 percent in France, 36 percent in Spain, 14 percent in Norway and 11 percent in Sweden.
The deal with AXS also means Rdio’s competitors have one less business development opportunity. As Deezer, Rhapsody, Google and Apple attempt to catch market-leading Spotify, the ability to reach broad swathes of music fans could be the difference between success and failure.