[saaaaaam]

It's a big niche and a premium niche. The beauty of classical music is that (by and large) you don't need to pay out publishing royalties. And, of course, if you own the master recordings, you don't need to pay out recording royalties either. So where, for a typical stream, the DSP gets about 30 - 35% of gross revenues on the rev share model, if they don't need to pay out publishing or recording royalties the DSPs gets 100% of the royalty pool relating to that consumption.

So if Apple gradually bought catalogue of recordings of long dead composers and this ends up being a significant share of consumption on Apple Music it's basically free money.

Plus, of course, by having control of catalogue they can do more innovative things (including making some of that catalogue available for free, to entice people into the service) so there are all sort of upsides here.

I suspect also that Apple Classical Music app subscribers are probably a wealthier cohort so probably more likely to convert to Apple One subscribers - and possibly more likely to be in the market for premium headphones etc.

[rcme]

Is it really premium? When I go to the record store, classical records are by far the cheapest.

[crazygringo]

That's a phenomenon specific to used LP's. It has nothing to do with the current classical market or streaming.

For whatever reason, of the people who are into vinyl these days, only a vanishingly small proportion are into classical on vinyl. Far, far less than the proportion of people who bought that classical vinyl in the first place. So there's essentially no market for it. Record stores will generally buy only specific rare/historical/mint classical LP's, in contrast to how they'll buy anything by Bob Dylan.

I'm not sure why -- curious if anyone knows. The two obvious theories are that buying LP's is a "hipster" thing and hipsters aren't into classical, or else that classical listeners are always looking for the highest fidelity and vinyl ain't it. After all, it's classical listeners who have long traded FLAC files rather than MP3's.

[qwytw]

People who like classical music probably generally have more money then average so they are good customers to have since it might be easier for Apple to upsell them all kinds of other subscriptions and services etc.

I assume recordings themselves are cheaper because of the reasons listed in the comment above.

[OfSanguineFire]

If that is the case, it is probably because your record store only stocks some budget and mid-range classical music releases, the sort of things that sell to relatively casual listeners instead of dedicated fans. Classical records from both the majors and boutique labels that are not part of budget series, typically go for 20€ or more per disc. Especially in the case of the label discussed in the featured article, which released many of its recordings in the hybrid SACD format which is more costly to produce.

[saaaaaam]

I more meant that the typical demographics of consumers around classical music probably make it a premium market, sorry, I was using shorthand.

That said - because most classical streaming services are really bad there's still a very active market for CDs in classical music, and because the production costs of making new recordings are VERY high (and there is a still a demand for them) it's a really weird market because you've got older catalogue available for rock bottom prices, and newly made recordings at pretty high prices. Hardcore classical music fans are completionists and so if there's a new recording that fills a gap in their library they are often pretty price insensitive.

When I worked adjacent to classical I was often given box sets of new releases. I noticed that one of those (which I still have - and which originally released at around $120) was recently sold on a second hand marketplace I follow for a ridiculous amount of money (hundreds of dollars) because it was on sale for a weirdly short time so you can only get it second hand.

[dan-robertson]

Is this a store selling new records or second-hand? I would assume demand/supply for second-hand classical records is much lower than other genres.

[isykt]

The classical market is primarily older, wealthier, and willing to pay for quality physical media.

[InitialLastName]

> willing to pay for quality physical media.

How does that square with Apple wanting to put the music from this label in an app? Upsells to collectible media?

[saaaaaam]

Convert last remaining streaming hold outs - Apple has high quality audio as standard, vs Spotify who still haven't implemented it even as a premium feature. The other high quality audio streaming platforms are probably too far away from the classical demographic (though, maybe Qobuz could) so it's a market where they can - potentially - own the market.

If you can get those folk to see the value of Apple Music, and they have an Apple TV (I bet there's a strong crossover here) and get them onto Apple One family plan, then you get kids/other family members using Apple Music.

So taking classical makes a lot of sense.

But yes, there's potentially also a physical side to it. I'm assuming that if Apple starts acquiring classical labels they will pretty much let them continue to operate as a record label - but with the luxury of perhaps not having to worry quite so much about top line economics.

Not a classical label, but another "premium" label I'm friendly with did a limited edition boxset of a particular artist and sold 1000 copies at about $400 - $500 a shot in under 12 hours. So doing premium releases is big money - but also very costly to manufacture, and when people are paying that sort of money they expect a REALLY great unboxing experience. Which, I guess, kind of aligns with what Apple does elsewhere.

[isykt]

Apple makes high quality speakers and headphones, that’s the cross sell.