Setting Up Your Own Music Streaming Service: Strategies & Best Practices

by | Oct 2, 2018 | Uncategorized

A world without music is difficult to imagine. With digital music close to taking over all other traditional forms of music streaming, it has seen a steady growth rate of over 10% since 2015. US showed the highest growth in the digital music revenue in 2017 at $3.4 billion with 53% increase as of 2016’s $2.2 billion.

One of the leading Music streaming service providers is Spotify. Started in 2008 by Daniel Ek and Martin Lorentzon, it reached 1 million subscribers by 2011 and crossed the 50 and 100 million subscribers paid subscribers mark in 2017 with its presence in over 60 countries.

Nowadays, most of the people who own smartphones are likely to use a music streaming app. According to Statista’s forecasts, the number of smartphone users in 2017 was 2.32 billion and is expected to surpass the 5 billion mark by 2019.

This can give you an idea of the huge scope behind the digital music streaming business.

Why is Now the Best Time to Start Your Music Streaming Business?

Statista reports the number of paid music streaming subscribers to be 106 million in 2016 and with a more than 100% year-over-year growth rate; this is expected to rise to 336 million by 2025.

Though there are many music streaming services available, like Spotify, Pandora, Apple Music, TIDAL, Rhapsody, Deezer, Google Play Music, Napster, and so on, the audience’s inclining interests overshadows the numbers of streaming services. Hence, the audience in the digital music space is continuously looking for more options. Establishing your streaming business now can help you catch their attention.

Questions You Need to Answer to Develop Your Strategy

Here are some best practices and customer-centric questions you need to address before designing a strategy of your music streaming service.

What Platform Will You Launch Your Streaming Service on?

The most convenient option for users to stream their music is on their smartphone. Launching your own apps on Android, iOS and Windows and providing OS friendly features can help your service stand out from the crowd.

How Will You Build Your Music Library?

Though most music subscription services offer comprehensive libraries, they fail to satisfy all audience interests. Some miss out on the classics and some on the latest trends. A diverse catalog can help you satisfy many audience interests.

Who is Your Target Audience and What are Their Demographics?

Defining your target audience is particularly important if you’re launching your service in a specific region, or if you’re planning to cater to a certain musical genre. This will form the foundation of your marketing plan and help you attract the right type of listener.

What Will Your User Experience be Like?

With fans rapidly turning to the online streaming space, increasing competition between businesses is inevitable. Hence, when a consumer is trying out different streaming services, they will tend towards a service that offers easy access to their favorite songs, and has a simple interface.

Will You Offer a Free Trial?

Unless your brand is well-recognized, people aren’t going to trust it right away. So, offering a free trial period is a good way to get them using and enjoying your streaming platform.

Will You Offer Exclusive Releases?

Identify and contact independent artists and let them know you’re interested in starting a music streaming service. Ask them if they’d be interested in releasing their music exclusively on your platform. This can give a unique face to your business, helping you to market your service and provide a unique platform for artists.

Will You Offer Exclusive Discounts & Special Plans?

Offering exclusive discounts and plans like family packages, student packages and others give your users more options to choose upon.

Creating a Strategy for Your Streaming Service

Once you have a clear idea mapped out for your streaming platform, all you need to do is form a cohesive strategy around your app. Here is a step-by-step guide on how to successfully deploy your video streaming service in the market.

Sketching the Business Model

Now it’s time to put together a business blueprint. Setting up a time frame with target numbers (users, content and revenue) can form the basis of your business strategy. Most importantly, coming up with unique and differentiating factors will make your app special.

Defining Your Target Audience

We’ve already looked at the importance of defining your target audience. Once you’ve set a timeframe for getting started and you have your target numbers in place, research your audience so you can home in on your buyer persona. This is a critical factor when it comes to knowing where to spend your money to begin attracting users.

Business & Revenue Models

The music streaming business model is simple. Your job is to partner with various artists, composers, online and radio channels, and enable access to music for your listeners. A popular way for streaming sites to earn money is with subscriptions, downloads and access to exclusive releases.

3 Ways to Generate Revenue

These are the three mediums that you can use to generate your revenue:


Offering membership plans and allowing users to access different services such as downloads, genre playlist suggestions, live and exclusive videos can all generate revenue for your streaming platform.


Advertising is the number one way most streaming services make money. You can display ads from Google and other independent advertisers.

Promoting New Artists on Your Platform

Your platform can be a launchpad for new and upcoming artists. A subscription or a commission based model can be used to feature their music on your applications.


When it comes to licensing, the entry barriers are high. The type of streaming service you’re planning to build (online radio, on-demand streaming service, transferable or non-transferable services) will be the main determining factor in the kind of license your business will need.

Second, you should determine the territory where you wish to establish your business in, as laws differ from country to country. For instance, you must comply with Digital Millennium Commercial Act in the US and PRS/MCPS online music license in the UK. You should also take care of licenses from composers and recording companies, whose songs your app will be utilizing.

MVP Development Process

Once you’ve taken care of the pre-deployment activities, it’s time to choose the right application developer for you. It is reasonable to start with a MVP (Minimum Viable Product) instead of building a fully functional application off the bat. A list of must-include features while building your audio streaming software includes:

An Attractive Homepage Layout

Banner images or collages of exclusive album art, trending artists and exclusive releases should be dynamically updated and displayed.

Registration & User Authentication

When you authorize a user on your system, you can collect their basic information and credentials by getting them to register with your service. Using user friendly options like an email or social media sign in process can be beneficial. The data you collect can be used to offer a personalized experience for your users after they sign up.

Onsite Search

The banner area should have a clear and visible onsite search tool to let users easily find what they’re looking for.

Your Music Player

A highly responsive and sleek music player should be integrated with easy options like play, pause, queue, repeat, next track and more.

Social Sharing

Let the users to highlight their favorite tracks on a social feed, share songs with their friends, follow artists and add new friends with the same music interests.

Playlists & Library Queues

Allowing listeners to create personalized playlists and suggesting these user-generated playlists with other users can make your app highly interactive.

Online & Offline Streaming

Online and offline streaming allows users to enjoy music at any place, any time.


Success in your venture will be contingent on many if not all of the above factors. The more time you put into planning, the greater the returns you can expect.