Assessing the Feasibility of the Tidal Music App - Case Study Example

ASSESSING THE FEASIBILITY OF THE TIDAL MUSIC APP By Table of Contents Terms of Reference 3 Procedure 3 The procedure of writing this business report includes the consultation of secondary sources which offer insight into the factors to be considered when launching a new music streaming app. In addition, the report considers market challenges as well as the venture’s strengths and weaknesses. Finally, the report concludes by recommending strategies to ensure the best outcome from the venture. 3 Introduction 3 The music industry has been one among the most ancient industries in the world. With the inset of digital content, music has shifted from selling via physical cassettes and is currently streaming online to subscribers from all around the world. Provided that the internet is a busy and risky environment when it comes to the provision of personal information as come companies require customers to provide during subscription, the aim of the startup business is to ensure that music listeners can listen to music on the go and that their subscriptions be as safe to use as possible. Safety in the music streaming industry can be hindered by two factors. Firstly, during subscription or login to an active account can be intercepted by hackers. Secondly, providing online streaming of music limits the loss of returns by artists and music vendors and therefore, limits piracy and boosts productivity. 3 Findings 3 SWOT Analysis 3 Conclusion 6 When considering the service to offer and the market segment to target, factors such as internal capability, competitive advantage, competing services, and overall returns from the target market are to be considered. TIDAL Music app is a startup venture that aims at providing customers with music streaming service for subscription. Based on SWOT analysis, TIDAL is favored by factors such as high demand for streaming service, shift from traditional means of entertainment to cloud computing, and the fact that due to high demand, the venture will not require vast amount of promotional funds. On the other hand, TIDAL app is challenged by factors such as stiff competition from established vendors such as Spotify and iTunes. Additionally, due to its limited budget, the app is likely to fall short of others that customer’s prefer due to user interface design. 6 Recommendations 6 Bibliography 7 Appendix A: Work Plan 8 Terms of Reference This paper is an evaluation paper regarding the nature of the music streaming industry. The paper deals with the challenge caused by customers’ trend of migrating to digital platform. The evaluation considers the risks expected when launching a new service to offer customers with streaming privilege on their mobile device and on the go. The venture proposal aims at projecting a startup business for streaming music from the cloud. The venture is expected to cost between $1000 and $1500 and should launch in 9 months’ time (February 25, 2016). Procedure The procedure of writing this business report includes the consultation of secondary sources which offer insight into the factors to be considered when launching a new music streaming app. In addition, the report considers market challenges as well as the venture’s strengths and weaknesses. Finally, the report concludes by recommending strategies to ensure the best outcome from the venture. Introduction The music industry has been one among the most ancient industries in the world. With the inset of digital content, music has shifted from selling via physical cassettes and is currently streaming online to subscribers from all around the world. Provided that the internet is a busy and risky environment when it comes to the provision of personal information as come companies require customers to provide during subscription, the aim of the startup business is to ensure that music listeners can listen to music on the go and that their subscriptions be as safe to use as possible. Safety in the music streaming industry can be hindered by two factors. Firstly, during subscription or login to an active account can be intercepted by hackers. Secondly, providing online streaming of music limits the loss of returns by artists and music vendors and therefore, limits piracy and boosts productivity. Findings SWOT Analysis Strengths From all around the world, different musicians and owners of music albums are changing to adapt to the current trends of shifting to the digital platform. The high number of customers from around the world also provide ready market for the digital content provided by producers (Pusapati, para 1-7). However, while the customers and producers require each other to sustain the industry, it is observed that a market gap exists providing TIDAL Music app with the opportunity to capture the opportunity. In this case, the TIDAL Music App aims at connecting music customers and listeners with music streaming services from all around the world. The fact that the app will be designed in a manner that all customers can access it at all time and subscribe to any music streaming service without the need to search over and over on the internet for a streaming service. Simplicity is a feature that the TIDAL Music app will make use of and use as competitive advantage as it will allow users easy access to services of their choice from customizable lists. The app also features a simple name which most youthful generations can relate to in the sense of entertainment online. Precision is yet another feature of the app that will ensure that all music searches, subscriptions, service billing, and service renewals are accurate at all time. This is achieved by programming the app in such a way that no bugs hinder accuracy of reports and user settings can be backed up and reapplied to the same application but on a different device. Weaknesses One of the major drawbacks of the TIDAL Music App is its state of being. As a music app, the application is not aimed at replacing the internal music players that most mobile gadgets have. In addition, the app is not aimed to access or play any music stored in a user’s device. With this two considerations, it is problematic in the sense that the design and purpose of the app may not meet user expectations as various other apps exist in the market. On the other hand, the development of the app and its launch to the market does not have a clear and accurate forecast of user reception. Thus, with problems in estimating usability and the number of users that the app may attract, it is a challenge to develop a more stable application provided that the app has the potential of lagging incase two much information is stored within the app. For instance, the fact that the app can save passwords to in-app subscriptions, I tis possible that the app can lose some of the date if one has too many subscriptions. Contemporarily, it is a trend that music streaming companies offer users of their music free subscriptions and access to free music (Brown and Linden, p. 17). This fact limits the need and pressure for users to subscribe to paid service when free streaming is available. Based on the availability of free service, the applicability of a billed service is logically minimal and hindered by factors such as the requirement to provide personal information in signing up. On the other hand, access to free music is considered a business strategy for companies around the world that deal with entertainment and consumer products. By offering free streaming service and hosting adverts on the user’s devices compensates the companies for the free service they provide to customers. In this case, the TIDAL Music App is limited in terms of how fast it can connect to companies involved in product promotion by sponsoring the streaming of free and legal music. Opportunity The contemporary generation of youths is brought up within a digital-technology sensitive environment and by virtue has developed and adapted to the mode of survival. Following the trend that individuals are shifting from traditional methods of listening to music to more modern methods has paved way for applications such as TIDAL to take on the opportunity. The business opportunity following the manner with which people shift from analogue to digital access of music offers music owners the opportunity to secure their music from piracy and offers services such as TIDAL’s the relevance in operating within the industry. High number of music streaming companies offer services to customers under two approaches. One of these approaches involve the free subscription to free music streaming with the catch of dealing with adverts. On the other hand, premium subscription deals away with the adverts and provides access to non-free music at a rather considerable price per unit period. Combining the two strategies in one app has the potential of offering a better service and customer experience than most of other apps competing in the same area (Sinnreich, pp. 58-64). Many music listeners around the world provide sufficient demand for the service TIDAL aims to serve and this provides the venture with an added advantage since it will not require costly promotional strategies to capture manageable customer base and sustainable returns. Threats Without the consideration of the market and customer demand, there are several threats that target the TIDAL Music App. Firstly, the music app is a product of programming with the capability of crushing if a bug or a virus attacks. This potential threat is capable of ruining customer experience and therefore influencing their consideration of other apps in the market. Secondly, the application design may not be the best in the market and some customers are likely to hold back their switching from favorite apps to try the TIDAL app. Thirdly when considering market and customer demand, the app faces stiff competition from other apps and vendors or similar service such as Spotify, SoundCloud, and iTunes. These existing services are environmentally favored by their brand names as well as the companies behind their development and sustainability. As a new venture, TIDAL will be forced to position its service to a market segment that is not targeted by the three major services mentioned above (Marklud, para. 4). Conclusion When considering the service to offer and the market segment to target, factors such as internal capability, competitive advantage, competing services, and overall returns from the target market are to be considered. TIDAL Music app is a startup venture that aims at providing customers with music streaming service for subscription. Based on SWOT analysis, TIDAL is favored by factors such as high demand for streaming service, shift from traditional means of entertainment to cloud computing, and the fact that due to high demand, the venture will not require vast amount of promotional funds. On the other hand, TIDAL app is challenged by factors such as stiff competition from established vendors such as Spotify and iTunes. Additionally, due to its limited budget, the app is likely to fall short of others that customer’s prefer due to user interface design. Recommendations In order to improve how TIDAL Music app performs within a market comprising of a vast number of potential rivals and capable competitors, the service to be provided has to identify a gap that has not been explored by other competitors. For instance, the streaming service requires devices to be connected online such that they are able to access online serves and stream. However, adding a feature of playing one’s playlists offline from cache memory for a specified duration such as over the entire subscription can be a competitive advantage to attract the cost-sensitive customers who would rather listen to free music through free data package. To limit the spending of cost-sensitive customers, access to playlists without reconnection would cater for the need. In terms of design and user interface, the app would be upgradable to latest versions on an over-the-air basis and therefore, the design will be revised based on customers’ experience and opinions (Chevalier-Roignant and Trigeorgis, pp. 47-74). Bibliography Brown Clair and Linden Greg. Chips and Change: Loss of Competitive Advantage. The MIT Press. 2011, pp. 15-38. Chevalier-Roignant Benoît and Trigeorgis Lenos. Competitive Strategy: Strategic Management and Competitive Advantage. The MIT Press. 2011, pp. 47-74. Marklud, Arnbjorn. SWOT Analysis Spotify – market competitiveness. Accessed online on April 23, 2015 from http://www.marklund.no/swot-analyzis-spotify-%E2%80%93-market-competitiveness/ Pusapati Mohan. My Corporate Environment Analysis on Digital Music Sector. Accesed online on April 23, 2015 from https://www.linkedin.com/pulse/20140615075625-241322894-my-corporate-environment-analysis-on-digital-music-sector-spotify Sinnreich Aram. The Piracy Crusade: We’ve Been Talking about This for Years”: The Music Industry’s Five Stages of Grief. University of Massachusetts Press. 2013, pp. 56-68. Appendix A: Work Plan Statement of the problem/trends The report outlines the need for a music app that can support and sustain the music industry by abolishing piracy which has been affecting the development of the industry. The startup business venture aims at ensuring that contemporary generations of youths using digital platforms to access the internet and online services can be served by providing them with easy access to digital music. The rationale for the developing TIDAL Music App is based on the fact that high number of customers and high number of vendors require a safer platform to buy and sell music. Statement of the purpose including expansion and restrictions The major purpose of the new startup venture is to take advantage of the online platform which is a safer place to trade music. With only subscription, the venture aim to promote safe online browsing and quicker access to any type of music offered within customers’ active subscriptions. Research strategy including description of sources and methods of collecting data The research strategy in this case is to analyze the streaming music industry. To accomplish this need, qualitative research making use of secondary resources is employed to provide an insight into the industry at hand. The sources considered in the research are annotated below; Annotated Bibliography Brown Clair and Linden Greg. Chips and Change: Loss of Competitive Advantage. The MIT Press. 2011, pp. 15-38. This source offers information on how competitive companies can lose the competitive advantage based on factors such as new entrants, change in customer trends, and shift of market. The source is relevant to this research as it offers information on how startup ventures can be competitive and sustainable. Chevalier-Roignant Benoît and Trigeorgis Lenos. Competitive Strategy: Strategic Management and Competitive Advantage. The MIT Press. 2011, pp. 47-74. The relevance of this source draws from its consideration of how businesses can be competitive. Provide that the use of TIDAL music app is to generate revenue while service demand, the source offers strategies to develop a competitive environment and sustain development. Marklud, Arnbjorn. SWOT Analysis Spotify – market competitiveness. Accessed online on April 23, 2015 from http://www.marklund.no/swot-analyzis-spotify-%E2%80%93-market-competitiveness/ This source is relevant to this research as it considers the SWOT analysis of an online music streaming platform, Spotify. The source offers information regarding how competitively well-versed Spotify is and the threats is may cause on TIDAL. Pusapati Mohan. My Corporate Environment Analysis on Digital Music Sector. Accesed online on April 23, 2015 from https://www.linkedin.com/pulse/20140615075625-241322894-my-corporate-environment-analysis-on-digital-music-sector-spotify Pusapati offers an insight into the variables that affect how business is done within the digital music sector. The source is relevant as it provided details of the factors influencing success of failure of startup venture. This information is useful in handling the research title as it helps in assessing effects of the market variables on the venture. Sinnreich Aram. The Piracy Crusade: We’ve Been Talking about This for Years”: The Music Industry’s Five Stages of Grief. University of Massachusetts Press. 2013, pp. 56-68. Piracy is a major problem in the music industry. This source is relevant to the research as it offers information regarding the effects of piracy. The research proposes TIDAL as a music app to limit piracy and therefore this source is valid and useful. Read More