Apple Music has a problem with users dropping the service. It’s called their churn rate – “the annual percentage rate at which customers stop subscribing to a service” – and Apple Music’s is three times that of Spotify.
_____________________________________
Apple Music has a churn rate of 6.4% per month, according to a new study by analysts Cowen. That’s three times the churn rate of Spotify in the same sampling. This is very bad news for Apple, as its music service with 15 million paid subscribers is fighting to catch up to Spotify’s 30 million paid.
The Gap Is Widening
Think of it this way: If Apple Music added 10 million new subscribers in the next 12 months, it could also lose almost 7.7 million, if the current churn rate holds, for a net gain of just 2.3 million. If Spotify adds 10 million new users in 12 months, it would grow by 7.3 million paid subscribers, widening the gap between the two competitors.
Perhaps, this is why Apple is reportedly eyeing an acquisition of Tidal.