Beats Music, the on-demand music streaming service set up by the high-end headphone maker, has been in the news quite a lot this week. That’s because Apple is reportedly buying it for $3.2 billion. Many have questioned the amount that Apple is willing to pay considering that Beats hasn’t even publicly revealed how many paying subscribers it has. A purported royalty report has leaked online which shows that while there isn’t a massive subscriber base yet, there’s good engagement of the service by users.
The service was launched back in January this year. According to the leaked report it only had just over 111,000 subscribers as of March. It further breaks down the numbers by claiming that 49,371 individual accounts and 61,621 family accounts made up the entire subscriber base in March.
While individual accounts cost $10 per month, Beats Music lets AT&T subscribers add up to five users to an account for just $14.99 per month. However since it provides an extended 90-day free trial to AT&T subscribers its unclear exactly how many of those accounts have been paid for.
The leaked report shows that Beats Music pays artists $0.000126 in royalty per play, significantly less than what rightsholders receiver from rival Spotify, which pays between $0.006 and $0.0084. This figure would juxtapose belief that Beats Music is more artist friendly. Even though its subscriber base is significantly smaller than Spotify, 49,371 individual subscribers played 116.4 million songs in March alone. This engagement rate is considered to be good.
It might be these factors that attracted Apple in the first place. A recent report claimed that Apple’s main interest is the music streaming service, but it’ll keep the hardware unit alive since its profitable. The company is expected to make an official announcement regarding the acquisition in two weeks.