Napster expansion drives Rhapsody's pursuit of Spotify
Younger rivals like Spotify and Beats Music tend not to share subscriber secrets. Same with Rhapsody, except it wants to stand up and be noticed once again.
Rhapsody's paid subscribers increased 63 percent in the year ended April 1 -- they rose 16 percent in the first quarter alone -- and it is adding 8,000 paid subscribers per day.
The stats Tuesday from the company, one of the oldest subscription music services on the Web, are a rare glimpse into the subscriber momentum of a private subscription streaming service. These are stats that Rhapsody and many rivals like Spotify and Beats Music have tended to keep under wraps.
The digital corner of the music industry is its most thriving sector, and subscription streaming is the segment with the strongest growth. That has attracted a diverse and crowded field of competitors, from rapidly growing startups like Spotify that have come to dominate the niche to marketing powerhouses like Beats Music, in a lucrative partnership with AT&T.
Rhapsody, as a result, is often an afterthought.
The company's turn toward more transparency is weapon against that relative anonymity, said Paul Springer, Rhapsody senior vice president and head of product. In his words, it's a response to Rhapsody not being "the shiny new penny."
Rhapsody's daily addition of 8,000 paid subscribers, for example, follows a Bloomberg report that Beats Music was adding 1,000 subscribers a day during its first month.
Though Rhapsody is growing in the US, most of the growth is driven by its expansion of Napster overseas, now reaching 32 countries total. The international growth has been spurred by partnerships with telecom companies, and Rhapsody recently started working in partnership with Synchronoss Technologies -- which works with carriers to connect and activate devices and services on them -- that could yield similar telecom deals in the US too.
However, the company's disclosure that it has 1.7 million global subscribers to either Rhapsody or its international brand, Napster, compares less favorably to the most recent figures from Spotify. Spotify hasn't updated its subscriber stats in a year, but those outdated figures put its paying subscribers at 6 million out of 24 million active users.
Rhapsody's goal with the disclosures isn't to outshine Spotify, it's to be included in the same spotlight.
"Spotify is clearly No. 1, but they're turning through tons of cash," Springer said. "The market can support two or three, and Spotify has one. We think we have the second."