Music streaming services fishing for profits

Music streaming services Spotify, Pandora and the more recent iTunes Radio have soaring numbers, but profits are not among them, says a report in the New York Times.

The beleaguered music business has found a following on mobile devices, but getting users to pay for monthly subscriptions has proved difficult.

For instance, Pandora, the only publicly traded streaming company, delivers about 1.5 billion hours of music each month to more than 70 million users, but the Times reports only about 3 million of them pay. The rest listen free with advertising sprinkled between songs. Even though it has a market value of $5 billion, Pandora has yet to turn an annual profit, the Times says.

“There is this irrational resistance for people to actually plunk down their credit card for streaming services,” digital music consultant Ted Cohen tells the Times. “We’re 13 years into the Napster phenomenon of ‘music is free,’ and it’s hard to get people back into the idea that music is at least worth the value of a cup of Starbucks coffee a week.”
 
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