Analysis

Rdio makes its play for more users with $3.99 Rdio Select tier


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rdio“We’ve all been flying airplanes that had business class only. There is no coach,” says Rdio CEO Anthony Bay, in an interview with BuzzFeed to break the news of a new $3.99 tier for the streaming music service.

The company is launching Rdio Select, as it’s known, in an attempt to reel in people who don’t want to spend $9.99 for a full subscription.

So what do you get in the coach-class of streaming music? Rdio Select will be a mix of Pandora-style personal radio and limited on-demand music: users will be able to choose 25 songs to download and listen to every day, swapping them in and out as they wish. 25 songs?

“More than most users download in a day, so we feel it’s enough,” says Bay, who claims that the licensing terms mean the $3.99 subscription won’t lose money.

This isn’t a global play, yet. According to BuzzFeed, Rdio Select will initially be launched in the US, Canada, Australia, New Zealand, India and South Africa through the company’s iOS and Android apps – what, no UK?

It’s not the first service to try the limited-on-demand angle, of course: UK service Bloom.fm had exactly this model before its closure in 2014, charging £1 a month for users who wanted to “borrow” 20 tracks, or £5 for 200. Another UK firm, MusicQubed, specialises in apps that offer limited downloads – although it selects them (based on charts, for example) rather than users.

Is a $3.99 tier what’s needed to finally put a rocket under Rdio’s growth? The service has never published details of its user numbers (and it’s not starting now with BuzzFeed), and according to the iOS App Store in the US it is currently grossing less than Pandora, Spotify, Beats, Rhapsody and Tidal.

Admittedly, that’s a snapshot from one platform in one country, but Rdio is still seen as one of the smaller players in this market. That brings a certain amount of freedom to be a feisty underdog, though: Rdio has been making some inventive moves lately, from its expansion into India to its willingness now to explore mid-tier subscriptions (and to break the news through BuzzFeed, for that matter, with its mainstream audience).

Positive press may encourage people to try Rdio Select, but figuring out how to market it cost-effectively will be the key challenge. Even bigger rivals will be watching closely to see how it does.

Stuart Dredge

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