To say that Neil Young’s Pono download service and dedicated audio player was a failure is an understatement. The service was very late to be introduced, and by the time it became available, downloads had been swept aside by streaming. Young also underestimated the consumer market’s attraction to high-resolution, especially when the prices are much higher than what’s commonly available. As a result, the project was essentially stillborn.
You have to give it to old Neil though, as he’s trying it again, this time with a hi-res streaming service called Xstream. The problem is that the same market forces still exist, which makes the likelihood of the the service being a success a long shot at best.
There are a number of factors that make Xstream an uphill climb.
1. Most people can’t hear enough of enough of a difference between normal resolution and high-resolution material to make them want to pay the difference in price. Tidal found this out with its $20 a month streaming tier. You never hear about its number of subscribers because they’d be embarrassing. Audiophiles have no problem with paying the extra 10 bucks a month, but there just isn’t enough of them to make a significant contribution to the bottom line of a dedicated service at the moment.
2. You can’t go up against the extremely deep pockets of Apple, Google and Amazon (and even first-mover Spotify) unless you have the same deep pockets. Young himself admits that it’s been difficult finding investors to get the venture off the ground and that’s no surprise. Most seasoned venture capitalists are aware of what they’d be up against. It’s not only paying for the infrastructure of the service, but mostly for the marketing that’s daunting when in the shadow of Apple or Amazon.
3. Any of the major streaming services can launch its own hi-res tier at any time. Apple especially has been collecting hi-res masters for about 4 years now and could launch a new tier or even just raise the quality bar on its existing service, which would kill Xstream and Tidal in their tracks. VC’s are acutely aware of this, so you won’t be seeing much dough coming from Sand Hill Road (the home of Silicon Valley venture firms) to get a new streaming service online, especially one who’s only unique feature is high quality tracks.
4. There’s probably going to be some problems with the name, as there are other companies using the same name already.
But Neil Young is a music legend and he’s able to get a lot of publicity for a project almost at will, as is happening now. I have my doubts if Xtream will ever see the light of day though. In the end, you still have to have demand for a product. So far, it hurts me to say that high-resolution currently has none.