Munster: Apple Music has overtaken Spotify in US

In its (much smaller) addressable market, Apple is converting customers to paid subscribers 2.5 times faster.

From a note to subscribers by Loup Ventures’ Gene Munster:

• In July, Tim Cook reported that Apple Music became the market leader in terms of paid subs in North America and Japan. We estimate Apple Music has 21m North American subs vs. Spotify at 20m.
• Adjusting for addressable market (we estimate that 95%+ of Apple Music subscribers are on iOS), Apple is converting potential customers into paying customers at a rate 2.5x faster than Spotify.
• Apple’s higher conversion rate can be attributed in part to iPhone owners having more disposable income compared to Android owners. A second, more material contributor is Apple’s ownership of iOS which distributes a seamlessly integrated music experience along with prompts to get iPhone owners to subscribe.
• Spotify still controls the global paying music streaming market with about 62% share, down slightly from 65% in Sep-17. Apple has grown to 34% from 30% in Sep-17. Pandora has lost share from 6% to 4%.

Munster’s spreadsheet:

My take: I remember when Spotify was going to kill iTunes. Instead we got Apple Music.