Spotify HiFi and Some Wishful Thinking

Spotify rocked the music world with its announcement on February 22nd that it would be launching Spotify HiFi lossless streaming later in 2021. The same earthquake was felt in the consumer A/V world as well but for very different reasons. High-end audio has struggled for decades to attract new blood. Everyone understands that most consumers have never experienced better quality audio; certainly not those below 30 who grew up with the iPod, iTunes, and Napster as their primary sources of music.

The resurgence of vinyl was an unexpected shot in the arm for the high-end category and we’re pushing even harder as a publication to get more people who are heavily invested in records to open their minds and wallets to better quality audio equipment. There are plenty of affordable audiophile turntables worth considering in 2021. Most of the people who spent over $626 million (USD) on vinyl in the U.S. during the pandemic so far are probably not using audiophile-grade turntables.

But what’s not being highlighted enough in all of this exuberance over record sales and Spotify offering a lossless tier — is that streaming represents 83% of the market and that there is no empirical evidence (or actual sales data) that Spotify HiFi is going to move the needle at all for mainstream consumers when it comes to better quality audio. Have Bluesound or Sonos seen a surge in sales since the announcement?

Why would it? Build it and they will come?

I’m not sure that it’s going to happen like that. Or certainly not as quickly as some may like.

How many people watched the Billie Eilish video and ran to their local audio/video store and spent money?

If Spotify are really serious about “better” audio quality then why didn’t they announce a high-res tier to put Tidal and Qobuz out of business?

Math is hard for some people but let’s take a look at the numbers.

I’ve had a Tidal account for almost 5 years and Qobuz account for slightly under 2 years of time.

One of the best things about Roon; which is another part of this conversation, is that I can see exactly how many albums I have on my list — and how many are high-res versions.

As of today, I have 3,491 albums saved across both platforms. Of that total – less than 20% are high-res versions of those albums.

That’s probably on the high side for most users, but I don’t really fall into the mainstream as the Editor-in-Chief of a consumer A/V publication.

The reality is that 90% of the music on both Tidal and Qobuz is not high-res. It is CD quality.

And always will be.

What percentage of the music on Spotify today is even CD quality?

Spotify has over 300 million users at this point and I’m not convinced that more than 10% of that total is going to make the jump to Spotify HiFi. 30 million people, however, is a goldmine for the audio industry. It would be a monumental opportunity (that may never come again) that we have to seize with a real plan. It can’t be a deluge of reviews about $10,000 loudspeakers.

The future of high-end audio is not going to take that quantum leap from an iPhone and Apple AirPods to a $30,000 stereo anytime soon.

The audiophile community is definitely growing, but that growth comes from those getting into vintage audio, used high-end components and entry-level systems below $5,000.

If you think the current generation of college students, and millennials are going to open their wallets in the next 5 years for $3,000 cables and $20,000 speakers — you’re fooling yourself.

We are at least 10 years away from one of the biggest transfers of wealth from Boomers and older Generation X parents to their children and grandchildren and while that will entail trillions of dollars (or less if we continue to spend ourselves into oblivion), I wouldn’t count on a lot of that going to high-end audio/video components.

How much is Spotify going to charge for his new HiFi tier? How many of its customers will pay an additional $5/month for access to its entire library in a lossless format? Will Spotify just raise their overall monthly fee by a few dollars and make Spotify HiFi an option in the settings for those who want to use it?

Apple Music with lossless is now a reality but Apple didn’t exactly blow that out without some significant hiccups.

We don’t know. And unlike former New York Governor Cuomo — we actually seem to know what he doesn’t know.

Using the best case scenario — what happens if 30 million Spotify subscribers decide to upgrade to the HiFi streaming tier?

Do they suddenly run out and buy millions of new audio products?

Most people who use Spotify exclusively on their mobile device are probably using Apple AirPods, or other Bluetooth-enabled headphones. How many of those can stream lossless audio right now?

Zero.

All good things come to those who wait? Yes — unless you’re using an iPhone or iPad.

The recent announcement from Qualcomm in regard to Bluetooth aptX Lossless is a huge development but we are 6 months away from the availability of any hardware that will offer that fantastic opportunity to stream lossless from a smart phone or tablet.

We need a plan. We have one here on our end as far as future content is concerned, but what is the plan of the audio industry?

Unless we have a unified one that can convince these potential 30 million new customers that better sound quality is only made possible with better equipment — this is all wishful thinking.

And you can’t create a future on dreams alone.