Dr. Dre isn’t satisfied with conquering the world of designer headphones. On January 21, his company will release a new product called Beats Music to compete with Spotify and Pandora. Bloomberg Media points out that Beats isn’t all that different from Pandora, which both rely on human curators to make customized playlists for users. But here’s what sets Beats apart:
Beats has a secret weapon, however, that its chief executive officer announced over the weekend: a deal with AT&T to offer free trial subscriptions as well as a “family plan” for up to five users. Those who like their service will get their monthly Beats Music fee bundled into their wireless bills. According to Billboard, AT&T sees the service as a way to upsell higher-end data plans to customers who suddenly need to stream more and more content.
Combined with the celebrity endorsements and an advertising blitz — Beats Music bought a spot to run during the Super Bowl — the service may be able to use its AT&T connection to attract some new customers and build momentum for its alternative platform. That may not be enough to make any money, however. According to an analyst cited by Bloomberg News, streaming-music services need 5 to 10 million paying subscribers to break even after licensing fees.
Read more over at Bloomberg.
After wrestling the technology away from a smaller company, Dr. Dre and music mogul Jimmy Iovine turned Beats into one of the most popular music-related brands in the world largely by associating them with high profile athletes like LeBron James. During these NFL playoffs, you’d be hard pressed to see 49ers quarterback Colin Kaepernick or Seahawks rival Russell Wilson go through pre-game warm-ups or post-game interviews without a customized pair of beats headphones around their necks. ESPN The Magazine detailed this relationship last year and it looks like that’s just the beginning.