Bloomberg News

Samsung Delivers Ad-Free Milk Music Radio Streaming to U.S. (1)

March 07, 2014

Samsung Galaxy S4 Smartphone

Samsung Electronics Co. began offering a free radio-streaming service in the U.S. today in a bid to attract and retain customers for its Galaxy-branded smartphones. Photographer: Victor J. Blue/Bloomberg

Samsung Electronics Co. (005930) began offering a free radio-streaming service in the U.S. today, taking on Pandora Media Inc. (P:US) and Apple Inc. in a bid to attract and retain customers for its Galaxy-branded smartphones.

The service, Milk Music, provides a “fresh approach” to the crowded music-streaming market by combining content licensed from Slacker Radio with music obtained exclusively for Samsung from artists such as Jay-Z, said Gregory Lee, president of Samsung Telecommunications America.

“We’re offering consumers amazing, rich music experiences built around what matters most to them and their lifestyle,” Lee said today in a statement.

Samsung’s service -- initially ad-free -- joins a roster of competitors to industry pioneer Pandora’s almost 9-year-old service. In addition to Apple’s iTunes Radio, Spotify Ltd. in December began offering a free ad-supported service for mobile devices in the U.S. and other countries. In January, Beats Electronics LLC, the company behind the popular line of high-end headphones and speakers, introduced Beats Music.

Milk Music draws from Slacker’s catalog of about 13 million songs. Like Apple, which is trying to tie users to its devices with iTunes Radio, Samsung’s Milk Music isn’t available on other companies’ devices that use the Android operating system or even Samsung’s own tablets. Users download the application from Google Play.

Differentiating Products

To stand out, Milk Music includes a unique eight-second caching feature that starts songs instantly as a user scrolls an on-screen dial, which gives tactile feedback while browsing genres and favorite stations, according to Samsung. The service lets listeners skip through six songs an hour per station.

The company developed the application over the past six months at its Samsung Media Solutions Center America unit, opened in Silicon Valley four years ago to create content and services exclusive to the company’s devices, company executives said.

“It’s a good step in differentiating their products,” said Ben Bajarin, an analyst at consulting firm Creative Strategies. “This is the first test of how good Samsung’s software chops are; the app is pretty solid with some cool stuff in there.”

The company will listen to consumer feedback on the service to decide whether to develop premium features or begin offering ad-supported content, said Aline Yu, senior director of marketing for Samsung Media Solutions.

In the U.S., digital radio ad spending increased 26.3 percent last year to $1.65 billion, according to EMarketer Inc. research. The category will grow to $2.04 billion this year, it projects.

Broader Base

Samsung had offered a U.S. subscription-streaming music service since July 2012, letting users purchase and download from a catalog of 19 million tracks. It shut down in late January. Milk Music should appeal to a broader base of as many as 80 million streaming radio listeners, compared to about 10 million global paying subscribers for such services, said Chris Martinez, director of services planning for Samsung Telecommunications America.

Milk Music differs from subscription services because it doesn’t force users to log in or even register, Martinez said.

“Other services have too many ads, too many interruptions,” he said. “Milk Music is instant, intuitive and an entertaining way to dial into signature music, and it’s ad-free.”

To contact the reporter on this story: Cliff Edwards in San Francisco at cedwards28@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net Anne Reifenberg, James Callan


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