A new research report indicates that the majority of music selections offered by streaming services is irrelevant to listeners. The majority of streaming subscribers listen to just five percent of the songs in most streaming catalogues.

Music streaming services are all the rage these days, but according to one researcher, organic subscriber growth isn't happening fast enough. That's according to MiDIA analyst Mark Mulligan, who feels that lower cost niche streaming services with far less content are the key to converting new subscribers to streaming.

"Most people aren't interested in all the music in the world and most people aren't interested in spending $9.99 (or the local market equivalent) a month for music," Mulligan claims. "Indeed, just five percent of streaming catalogues is regularly frequented. Most of the rest is irrelevant for most consumers."

Spotify offers a two-tiered platform that includes free and paid subscriptions. The vast majority of Spotify subscribers, 55 million out of an estimated 75 million, pay nothing, and only a percentage of the remaining 20 million pay the full $9.99 fee for a paid tier. Meanwhile, although music streaming continues to grow across all platforms, the biggest increases have been seen in the free streaming sector. YouTube has seen larger growth in music listens/views this year than any paid competitors, and free SoundCloud listens have doubled in the course of a year.

Mulligan feels that Apple's new Apple Music streaming service is more likely to induce paid subscribers away from other channels like Tidal and Spotify, rather than introducing new paying customers into the mix.

So, what is the best strategy for convincing listeners still unwilling to pay to board the streaming bandwagon? Niche streaming services that cost less and focus around a smaller selection of music, according to Mulligan.

"[G]ive those more casual music fans a music app just built around their tastes and for a fraction of the price and the equation changes from zero sum," he says. "Imagine genre specific playlist apps for $3 or $4 month. A dozen curated playlists, a handful of featured albums and a couple of radio stations, all just of your favorite style of music and all streamed into a dedicated app. Not only does this proposition deliver clear value, it also gives the industry an opportunity to open up new users that have thus far not been swayed ..." says Mulligan.

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