Today, Microsoft announced that it's killing off its Groove Music Pass service, just over a month after the company ran a promotion that offered six free months of the service with the purchase of one month. "But the app will no longer stream or play Groove Music Pass content after December 31, 2017". To help with the transition, Groove Music Pass customers will be able to move their curated playlists and collections directly into Spotify.
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For those users who have a Groove Music Pass subscription that extends beyond December 21, 2017, Microsoft will give a prorated refund for the difference.
Effective immediately, Microsoft will cease the sale of Groove Music passes. The most likely explanation is that the service did not perform as well as Microsoft hoped it would be.
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Apple (NASDAQ: AAPL) and Spotify are the two heavyweights in music streaming, collectively commanding almost 100 million paid subscribers at this point.
Microsoft plans to release an update for Groove Music that includes the option to move music to Spotify. While Apple Music and Tidal are still trucking along, Microsoft has made a decision to throw in the towel, as the company has announced that Groove Music will close down later this year.
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According to the Music Consumer Insight Report, in August 2017 YouTube received 1.3 billion visitors who came specifically for streaming music - although most of these listeners aren't subscribers. Existing Groove Music subscribers are being encouraged to transfer their playlists and libraries to Spotify. Obviously, Groove Music Pass did not pan out financially as the company expected. At the same time, it's also a tacit acknowledgment that the online music field has largely become a two-horse race between Spotify and Apple. It's important for users to download and backup Groove music purchases before the end of the year. Or their collections can be migrated to Spotify beginning sometime in mid-October.