Off the mark with Spotify revenues

7 thoughts on “Off the mark with Spotify revenues”

  1. I’m still very curious as to the conversion rate that the service will see from its forced Facebook integration. As it is with Facebook in general, just being a user doesn’t mean that you’re an engaged user. In the case of Spotify, the levels of engagement need to be two-fold – Both heavy listenership for advertising revenue and those who are willing to pony up the cash to go for a subscription once the free time runs out.

    I think, of all of the streaming services out there right now, Spotify likely has the best shot at being successful in the long term, but there are still loads of uncertainties to overcome.

  2. This is why I’m so bearish on the Pandora stock pick. Too many competitors, ease of entry and not enough monetization. I think Spotify will be on top eventually once it gets more market saturation. Still, I wouldn’t want to invest. Good numbers Om.

  3. Spotify – like all the music services – will never turn a material profit. This is because they are forced to sign onerous licensing deals with the major labels. This means even if you build a service consumers love the royalties paid to the labels will consume all your revenue. Remember they are all short term deals which means the record labels can and will raise them as Spotify grows.

  4. as far as pandora goes, spotify’s radio feature sucks. the songs it picks are so bad and a lot of them unrelated to the genre you choose(trance in my case) that it is simply no replacement.

  5. The number of advertisements Spotify was giving me increased by about the same percentage as their sales I think! I did go Premium for a while, but the radio feature never really delivered for me, so have now gone back to Grooveshark.

    Will be interesting to see how much of an effect their Facebook integration has on the subscription levels, it was always going to bring in additional (free) members.

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