Spotify has a unique position with their amazing discovery/recommendations engine- they could potentially start their own "label" and promote their own artists that sign on. Small/independent musicians could see more exposure and Spotify can deliver more music tailored for individual tastes. I've personally found myself listening to lots of small/indie artists as a result of their algorithms, to the point that these now make up the majority of my listening experience.
I think getting into concert tickets/streams, merchandise etc could help them potentially capture quite a bit of value in the future as well.
I know the comparison is similar to original content & Netflix - but keep in mind there's an opportunity cost with media (one can only consume X amount of shows/songs within a period of time). The more attention Spotify can divert away from the major record labels the better.
This seems to be a common refrain that Spotify can just "pull a Netflix." And this is very unlikely.
Firstly no matter how much opriginal content they could create, if they don't have back catalog it's going to be a total non-starter for the mainstream. A streaming service that has no Beatles, Pink Floyd, No Motown, No AC/DC etc is going to shed users pretty quickly.
Also music and movies occupy very different spaces in peoples lives - emotionally, socially, where and how they're consumed and shared etc.
People need music for their commute, for their workouts, for their parties, at bars and for their workdays. People only need movies when they're home or maybe stuck on an airplane.
Lastly Spotify needs to stay in the record label's good graces. If they were ever to be viewed as a competitor or a thread to any the big 3 record labels it would be reflected in punitive price increase when it came time to renegotiate their licensing deals.
I disagree. I think for most people music is fungible; they just want something to listen to. I think Spotify can afford to have gaps in it's library. Sure, if a large enough portion of the music industry cut them off it would be an issue, but I don't think they're in imminent danger of that.
People pay Spotify a monthly subscription for the convenience of being able to listen to the music of their choosing, at the time and place of their choosing. Anything that jeopardizes that convenience is going to be a problem.
It’s extremely irritating, but not enough to make me go elsewhere as I can’t see any other service not having the same problem.
If a song is removed from Spotify entirely, it just disappears from the playlist.
I'd love to be proven wrong, however, and start to see all the tracks that have disappeared in the past!
Now, imagine the scenario comparable to what @bogomipz said above: "no Beatles, Pink Floyd, No Motown, No AC/DC". I'm betting all of us would be a lot more frustrated and irritated than we are right now. Maybe you won't do anything about it. Maybe I won't, either. But it sounds plausible that a lot of people will, whether they switch to a different service, come up with a solution of their own or simply revert to piracy.
For those interested in this one, small-scale phenomenon: https://qz.com/767812/millennial-whoop/
Most people on Spotify don't make their own playlists at all, and just rely on the ones that Spotify supplies in the Browse tab, or listen to albums.
From a quick scan of the friend activity pane, if Spotify only had music from the past 5 years, 80% of my friends would still be able to listen to their music.
People complaining about gaps in their library are a definite minority.
If you are the kind of person that will sometimes strongly desire to listen to only one song/style/artist, and that desire is so strong that nothing else satisfies it, then Spotify not having your track can be a big deal.
If I can't build a decent playlist because Spotify's lack of coverage, that's going to be a big deal to me.
The mainstream is not sensitive to nor do they care about the logistics of music distribution. I wish there was a way for Spotify to ignore these bullshit distribution deals because the only people who care about them are megalabels and their A&R reps. I don't know of a single artist making bank off streaming...
It's like complaining about the lack of techno (especially remixes) on Spotify, that's what Beatport is for.
If they start poaching artists from the labels who own the back catalog or if the labels start to see Spotify as a competitor instead of customer there will a reckoning when it comes time for Spotify to renegotiate their licensing terms with the labels.
And then of course there's the risk of becoming a record label. For every Bruno Mars that blows up there are 30 or 40 other artist that failed to break. And each of those flops costs money and requires resources such marketing, A&R people etc.
>"All they need to do is to get people to stream less licensed content and more own-produced"
People want to listen to what they want to listen to when they want to listen to it. That's the whole value proposition of streaming for users. If someone has a specific record or song in my mind you aren't just going to persuade them to try some "non-licensed" content instead. It's not a sports drink.
>"I would assume that Spotify's music licenses are highly variable cost, ie almost entirely pay-per-stream."
No its most certainly not pay as you go. In fact the labels demand a certain percentage up front.
You nailed it. Music has a fundamentally different mode of consumption from music. People consume music in so many different ways and contexts. Music doesn't always demand your attention like a sensory-engrossing medium (like movies). But when music demands your attention (like having to change providers to hear a specific song) it introduces friction that is unnatural to that medium.
Netflix has plenty of third-party content.
However, in my experience in the UK, if you pick a well known film at random and look it up on Netflix, there's only about a 5% chance they'll have it.
Not the sort of library that will have users throwing away their personal collections.
Spotify has a lot of competitors biting at it's heels, they're certainly the largest (and IMHO, best) at what they do, but they've by no means locked up the market.
They're not exactly at the mercy of the labels, but they probably can't afford to piss them off either.
This could lead to cartel-like behavior among the stakeholder labels and crowd out the smaller players, but that's basically been happening in the industry for a long time so I'm not sure how big the impact would be.
Time will tell but i feel like this can go either way.
If you made that statement I'm guessing that you don't realize that the Beatles have been relevant for 50 plus years now and AC/DC for 40 plus years.
They are so enduring because they are classics. It's amusing that you believe that when yet another generation discovers these artists they are somehow going to become less relevant.
Both of those artists that you used in your example were long time hold outs to allowing their music to be streamed. And it was huge news for Spotify when they were added to their catalog.
It's worth mentioned that Beatles tracks were streamed 50 million times in the first 48 hours that they were available for streaming.
Spotify was excited to get them because it means older people might join. A larger audience, that's it.
65% of those 50 million streams in the first 48 hours were by people under the age of 34. See:
So yeah, catalog is king.
It's very bizarre that you don't understand the magnitude of the The Beatles. They are not something that requires a push.
So here's some number regarding the first 3 months of their catalog being available on Spotify:
"24 Million Hours Of Beatles Music Has Been Played In Their First 100 Days On Spotify
The company revealed today that in just over three months, people around the world have played 2,793 years worth of Beatles tunes.
Yes, that’s right — years. When that figure is broken down, it can be better understood as about one million days, or over 24 million hours. Considering that the average Beatles song is less than five minutes long, those 24 million hours multiply into several hundred million plays."
In fact, a conservative estimate of total Beatles plays on Spotify is still over a quarter of a billion. 
I don't find it bizarre at all.
They are basically unplayed on UK broadcast radio nowadays and indeed for the past 30 years. I don't know if that is due to restrictive licensing or just lack of interest.
I am mid-40s and have never knowingly listened to an entire Beatles song. I've just asked my wife and she has never owned one of their CDs.
I don't know if they're even on YouTube. Edit: yes, their most popular song has 123 million views versus 3.2 billion for Gangnam Style.
My only peers who seem interested in the group and seek-out their music are musicians themselves.
I’m not sure why I’m bothering because you continue to miss the point and instead use multiple logical falicies to try to belabor your point. I get it, you have an obsession with this and you want to convince the world you’re right, doesn’t make it so.
I’m happy to be proven wrong as I have no skin in the game, but so far, you’ve not done so.
No my original point was the value of back catalog.
While its unfortunate that you aren't able to follow the conversation, it's even more unfortunate that you insist on making comments when you have nothing of value to add.
Rather, Bandcamp should start a streaming service. I've had a payment model in my pocket for years that I think would work really well for them.
source: I used to work in the data side of the music industry.
Indie and emerging artists aren't going to sign with a label if it means their music isn't available on Spotify, the #1 streaming service.
Music labels may have modestly more leverage, but it is not impossible for Spotify to start their own label while also maintaining relationships with existing ones.
Tidal has already been doing most of the stuff people are proposing here. It's a controversial topic but I don't think there is good evidence that music streaming services, from a business standpoint, shouldn't also be in the business of producing or sponsoring musicians.
Using the smallest of these 3 Time Warner Music Group, the company did $2.87 billion in revenue in 2013.
Let's say that Warner was actually interested in a sale. Let's say that the multiple they were looking for was 5x. Where is Spotify going to get the 15 billion dollars for that sale? Certainly not from this direct listing. And even if they had that cash what happens when you buy a 3,500 employee mega corporation? You actually have to run it and run it well.
Where does the fear of these labels come from?
Why doesn’t someone just buy them for the catalog, and fire everyone in the dying parts of the business?
De-risk your revenue model, and gain leverage vs other streaming services.
Last I checked, Spotify has those artists. Have you actually used Spotify lately?
Thus, Spotify can't directly attempt to go in the same direction that Netflix did, as the other labels would see them attempting to compete and could possibly pull out, destroying any reason to use Spotify in the first place.
I could mangage quite well without all these.
Just one datapoint but...
If like me you like composing playlists instead of playing one full album at a time then not having the vast majority of your music available on a single service is a huge deal breaker. When I hear a song out there and I want to add it to my playlist I expect that it will be available on Spotify and the vast majority of the time I'm right.
If I need to go hunt for songs on various services and I can't easily make a single unified playlist with all of it I think it'll be back to piracy for me, it won't be less convenient and it'll be much cheaper.
The need for them to be a record label is not for exclusivity, it is so they can operate as an equal partner. At the moment their entire business is based on negotiating deals with record labels, all Spotify can offer is revenue, so they will be squeezed and squeezed as each contract is negotiated and renegotiated.
Every artist that signs up to them will save them this cost in the long run... So I'm sure there'll be seemingly crazy deals like comedians have been striking with Netflix, which in the long run are will be very beneficial to Spotify.
My only issue here is that I'm not sure if existing labels will begrudge a new competitor on the block (and then try to kill Spotify). It doesn't seem to me like Spotify being a fellow label gives them much more that the existing labels would want, but maybe I'm just not thinking of it.
According to my memory and a little research , the record labels have some stock stake in Spotify. Personally I think this is Spotify's best bet: if the labels can derive stock gains from helping Spotify (plus licensing fees), they have skin in the game so they won't try to sabotage Spotify. I'm of the opinion that instead of trying to produce music (and fight the record labels), Spotify is better off getting into a complimentary position: make it easier for fans to find out about concert, purchase tickets at fair prices, and buy t-shirts. All stuff that Spotify can probably do better than the record labels, and which won't cut into label profits.
With Netflix, my reaction depends on if I watched the content before it was removed.
With Spotify, it's almost always rage.
Why? I often listen to music more than once but I often don't watch movies more than once.
I have this problem with Spotify. About 80% of the music I like is on Spotify. Private label, soundcloud, older forgotten bands, and foreign music is often missing.
Music lovers also tend to be very particular and nuanced about their taste in music. Therefore, if I as a consumer don't find my music on spotify it means I'd have no reason to subscribe nor come back to spotify.
First and foremost, I agree that Spotify will struggle if they try to compete with other services on providing all artists.
It seems like listeners (or perhaps a subset) are listening by genre rather than by artist. I know genres and waves of music are nothing new, but with the lower barriers to creation as well as to consumption , we are seeing the number and frequency of new genres and sub-genres increase dramatically.
Anecdotally, I find myself using radio based music a lot more. E.g. I have a Synthwave station on SoundCloud that I listen to. I think this style is further exemplified with the popularity of sharing Spotify playlists. This is also why I think Spotify in particular are ahead -- the very people who would listen to Spotify published content are the people that already use Spotify.
In fact, I think this style better fits a lot of people who would use a streaming service in the first place. A lot of the people who want to listen to their favorite artists question the idea of paying for a subscription to maintain access to their favorite albums.
Of course, if Spotify goes this route, they are not alone. They would have to compete with services like SoundCloud and BandCamp. I think they could find success by toeing the line between major label content and indie content.
: e.g. a "bedroom musician" can make their album over the course of a few weeks and then that album gets bought and listened to by someone thousands of miles away within minutes/hours of release. No printing copies, shipping, stocking, ticket purchasing, etc.
If Spotify can solve discovery, by using actual human listening patterns, playlist contents, machine classifiers, or whatever else they may have at their disposal, it is much less important that they have licenses for all the most popular songs. The popular songs are the easiest way for the system to determine what kind of sound any given listener will like, but tuning the radio and auto-playlists to respond to likes, skips, and dislikes should be able to reveal the songs that people will like, from artists nobody has heard of [yet].
I think they're almost there. When I go to radio mode based on my "Liked from Radio" playlist, I want to also be able to specify between "I'm passively listening, so just play music I probably won't want to skip" and "play only new stuff, so I can actively train your algorithm". As it is, it mainly just plays things that are already on my list, and I have to skip ahead on everything I have already liked when I'm trying to train it.
The key issue is that if Spotify is the music discovery engine, people won't discover music that isn't on Spotify. You have to license to them, or you don't acquire new fans. It only helps them that broadcast radio has consolidated itself into a uniform ball of only the greatest hits by only the biggest stars.
Their execution on doing their own content has been great. However the long term value of these movies / shows still has to prove out in profits at some point.
Perhaps when they're not competing as heavily with Apple and to a lesser extent Google they could start their own label and the major labels would just have to deal with it, but I don't think it's a realistic course of action until then.
This was less of an issue for Netflix as Netflix streaming already had an extremely limited selection of third-party licensed content.
Making a TV series or a movie is not the same as making Music. Artists sign with a label and they are more or less stuck with them.
Edit: Like Aldi does for groceries
If Spotify start a label and is successful with it, the Music industry will most likely end up worse state than it is now.
They won't be able to get into concert tickets at the present time in any significant way due to the exclusive agreements between Ticketmaster and venues. Though maybe the could start with some smaller acts and venues and work their way up.
Live performances is where the money is for the artists which is why record labels are now signing acts up for complete deals which include not just the music rights but the concert and merch rights as well.
Edit: as somebody who has tried to buy tickets to a hot show on Ticketmaster the second they go on sale and watched the servers melt, it is Amazon that I would like to see get in the ticket game.
My pie in the sky recommendation would be to figure out a way to offer a record label's services for free without exclusivity. Then existing labels will have nowhere to turn.
I’m just as amazed by that this problem has yet to get solved today as I was 15 years ago.
Consumption is different, as well - several minutes at a time versus dedicated visual attention for a minimum of 22 minutes.
Do I think Spotify has anything special over Apple, Google, or Amazon? Call me skeptical. I'm just not sure you can make a direct comparison between an audio service and a video service.
Spotify playlists and Browse are very bias. My Spotify 'home page' shows me mostly popular/mainstream stuff that I never listen to. :)
There's however plenty of automatically generated customized playlists available next to that. When you create a playlist it also recommends tracks it thinks will fit etc... I haven't found any obvious bias in those so far and they often recommend obscure old tracks that I doubt anybody cares to promote anymore.
There's also the Fresh Finds playlists, which work a little differently by surfacing unknown songs that "tastemakers" have been listening to.
Whatever your opinion on "current gatekeepers", some of them do provide valuable filtering services that I struggle to see how an algorithm could accurately replicate without compromising what makes music magical.
Blogs, don't know how they're going to discover stuff if it's all published on Spotify initially.
Netflix is approaching - or already larger than - the size of Disney's comparable entertainment business, and Netflix is growing relatively fast whereas Disney's business isn't growing much or at all.
Disney's studio division does $8.3 billion in sales. Their media networks arm, which includes ABC & ESPN, does $23 billion.
Netflix will hit ~$14-$15 billion in sales this year. Apples to apples in terms of where they compete, Netflix will be comparable to or larger than Disney in size in 2018 or 2019.
Five years from now Disney isn't likely to be much larger than they are today (just look at their growth the last few years, flat to minimum). Netflix will very likely be over $25 billion in sales at that point (which would plausibly be larger than Disney's largest business, the media networks group).
At the scale Netflix has reached, every dollar of new growth that Netflix is obtaining is taking some bit of revenue away from Disney. Disney is going to mostly cannabilize themselves in switching to their own streaming service, including the mess at ESPN (the end of the hyper lucrative, subsidized cable & satellite subscribers that have been artificially fattening Disney's entertainment wallet for years).
Disney is mostly in a scenario of attempting to hold their ground. The same place Walmart is in with Amazon and for the exact same reason (minimum overall market expansion, low consumer spending growth across the developed world, while the new competitor is starting to eat your existing house).
Interestingly another similarity between those situations: Amazon is willing to compete at near zero profit generation in retail to pursue sales growth, which is brutal to an established giant like Walmart who has a huge investor base that expects them to generate considerable profits every year. Walmart can't just drop their profits dramatically to compete, their stock would implode. Disney is facing the same storm: Netflix operates at a level of minimal profit (~4%-5% net income margins), whereas Disney's long-established shareholders expect rich profits and a dividend (Disney typically sees 10%-20% margins in their entertainment groups, with a 16% overall net income margin). Netflix is willing to plow almost every dollar back into content production and licensing, and their shareholders cheer that on so long as the top-line growth continues.
Families with young children will subscribe to Disney's service almost guaranteed, and since a few years ago Disney has enough content for the parents, too. Why pay for two or three streaming services? Maybe Disney is enough. Disney's portfolio will also not shrink like Netflix' does often due to expiring licensing contracts but steadily extend over time.
Netflix might grow like crazy currently but they are massively in debt due to their movie making and their startup-like growth will eventually stop. As a Netflix subscriber I wish them the very best but I really, really hope they are aware of Disney and will be able to keep up.
Disney movies are just the top of the funnel that feeds revenue into their theme parks, dvd sales, television stations, and soon their streaming service.
By the time a movie gets to their streaming service, it has already made millions from the theatrical release. By the time a TV show gets there, it's already made money from advertising on TV. The streaming service doesn't have to find its own content or buy it from someone else like Netflix does.
An acquisition like that might be as likely to throw Disney into chaos as anything and give Netflix a leg up on stealing market share, given the corporate history of very large acquisitions.
That also of course depends on what the Netflix growth profile looks like over time as well.
For example, does Netflix routinely still generate 15%-20% annual growth after they're up over $20 billion in sales? If so, there's nothing Disney can do to stay with them short of continuing to buy up the rest of the entertainment universe.
The global subscriber momentum Netflix has now is incredible. By the time Disney figures out exactly how all of their streaming pieces are going to fit together, Netflix might be up to 250 million global subscribers.
> Apples to apples in terms of where they compete, Netflix will be comparable to or larger than Disney in size in 2018 or 2019.
For share of streaming wallet yes; but they hover at only about 5% of net income. So Disney doesn't need to be anywhere near the subscriber amount to reinvest heavily in content and acquisition. Also - Netflix has the US mostly saturated so they have to create or sign content for the various international markets. While Disney already has great content with global appeal.
That's not quite the context. Netflix is rapidly growing sales and plowing its potential income into content expansion.
Disney has zero sales growth, with a large traditional investor base that expects profits to at a minimum not contract. That traditional investor base holds Disney to a particular standard that Netflix doesn't have to suffer (for now). Disney can't reinvest any more of their existing sales & profit toward content creation without subtracting from the profit figure they report. If they do that at any meaningful scale, the stock will crater.
Disney's situation is actually even worse than that, as the erosion of cable is eating into their solidly profitable TV business (especially ESPN). So they're facing a declining context on sales, profit and margin, and they can't afford to redirect a meaningful share of their existing profit.
Simply put, right now Disney has no sales growth to direct at new content investment. They have existing profit that is already allocated to placating investors that expect the net income statement to look great and expect the dividend to remain or increase. This is why Disney is looking to spend a vast sum to buy business expansion with Fox, to perhaps placate shareholders a while longer (how long will they tolerate zero growth otherwise?).
Netflix gets to operate on different terms of shareholder expectations than what Disney does.
Otherwise, Netflix would have a market cap about 90%-95% lower than it is right now, if Netflix (~220 PE) were being judged on a more near-term profit basis as Disney is (~14-15 PE). It's the exact same growth expectation benefit that is being given to Amazon ($3b net income) vs Walmart (~$14b net income).
For now. They have a large enough reach to essentially "become" a major record label, all they need is to start signing artists to contracts.
I was thinking that if Spotify kept the same experience for listeners that they had now in order to grow their subscription base, and just reported higher earnings for the artists they had signed versus ones signed to a 'different' label, that over time as contracts came up for renewal people would move over to Spotify.
Good content is good content. For music - it's even better if it's not yet well known because for some reason people think more highly of themselves for being an early fan. Early discovery favors audio moreso than video. So pushing originals (newly signed artists) is a great strategy for Spotify. So long as it's good music.
Mind you, I don't like video being fragmented but that's a more deliberate choice a lot of the time for me. I'll subscribe to a few places based on available and original content--somewhat grudgingly to be sure--but I accept those are my options.
Google is worth 1000B, general motors is worth 60B.
Why? I'd contest GM has more 'stuff' and abilities to do 'anything'. Google has a bigger population, but what does that translate to when the value of tech might be lower.
I'm not saying tech isnt more valuable, but there might be something wrong with google being 1,700% larger market cap than GM.
GM exists in a very competitive industry with major competitors at or above their capacity, while Google has maybe 1 or 2 competitors in several of various industries, and dominates several independently and almost completely.
GM might be able to claw aware market-share from competitors, and end up more valuable, but not by that much. Google is in the sort of position that allows them to potentially capture a brand new industry if one appears.
GM could (relatively) easily get broken up or get massively devalued to to a large market event or by falling behind in an industry that is rapidly changing shape from what they are accustomed to. Google falling out of existence/dominance would almost have to be the result of a fundamental societal shift at this point (or anti-monopoly legislation somehow), and they could throw enormous amounts of cash at problems for years before facing insolvency (from my understanding).
Spotify definitely doesn't have enough market share for that to be true, and it's not clear that they ever will. Youtube has always had more free listeners than Spotify and Apple Music is set to surpass Spotify in number of paid listeners sometime this summer.
There's probably a danger that large record labels will threaten to revoke their licensing agreements if they think that Spotify may start competing with them on that front. Not sure if that will be a problem, though, I'm not familiar with the whole streaming market.
If there's any evidence against this, please let me know. I think it's interesting.
Apple Music is supposedly set to surpass Spotify in number of paid subscribers this summer.
Youtube has always had more free listeners than Spotify, as far as I know.
It's not at all clear who the major players in the music streaming business will be five years from now, which means that all of the power remains with the owners of the music that people want to listen to. AKA the major record labels.
Where did you get this info? Look at the graph
In recent years artists like Drake have started their own labels and collaborated directly with tour organizers to generate different sources of income and cut out middlemen. While it's difficult to imagine Spotify generating hit music at the same pace as Netflix produces hit shows, there is nothing stopping them from becoming a tour organizer or bringing artists to perform at their own show (hint: iTunes festival).
If they are really serious about the long term they would be developing new ways to experience "live" music. Perhaps VR concerts and performances or features that let the audience send feedback to the artists.
The good news is that they have shown they are not afraid of trying new things (ex: Video player within the playlist and the RapGenius tie ins).
Time will tell but I am bullish on Spotify changing how we listen to music for the better because the industry is ripe for a new disruption (Records -> CDs -> Digital -> ???)
 - https://www.digitalmusicnews.com/2016/05/26/band-1-million-s...
Drake starting his own "label" is not a new innovation he came up with (rappers been doing that since the 90s) and still comes with just as many middlemen. Emphasis on last sentence in quote.
>During the composition of Nothing Was the Same, Drake started his own record label in late 2012 with producer Noah "40" Shebib, and business partner, Oliver El-Khatib. Drake sought for an avenue to release his own music, as well helping in the nurturing of other artists, while Shebib and El-Khatib yearned to start a label with a distinct sound, prompting the trio to team up to form OVO Sound. The name is an abbreviation derived from the October's Very Own moniker Drake used to publish his earlier projects. The label is currently distributed by Warner Bros. Records.
See: G-Unit, OVO, GOOD Music, DFA Records, OWSLA...
In my view, Spotify have pretty much "won" the streaming war. They beat Apple to the market with their streaming offering, and they have a good product that people love.
The one area Apple has Spotify beat is in its understanding of the music industry. Apple's acquisition of Beats seemed ridiculous at the time, but getting Jimmy Iovine on your side in a music war is like having Goku on your side in a Universe Survival Tournament. When you've got the likes of Jimmy Iovine and Zane Lowe committed to your cause, you're going to know how record labels work, how the industry works, and given that Iovine recently came out to say that streaming services are similar and need to diversify to succeed I'd be inclined to agree with him.
Apple have failed in the past by trying to make its music exclusive and by having artists on its payroll try to attack Spotify (to backlash on both sides). It makes me think that Spotify could wrap things up by doing what you say, but licensing its own songs equally to all other streaming services. Instead of doing what Apple did, promote availability by ensuring their music is played on competing services.
Of course, to do this Spotify will need their own Iovine, and that's no mean feat. They'd need world-class talent behind them to find musicians, produce them, and market them in the way that Apple potentially could. If Spotify can build that dream team and create their own means of production then, in my view, they've won.
This should be considered when making points about what the Record Industry will allow spotify to get away with. They own a lot of the shares at play here.
Have you ever used last.fm? I would be interested to hear if people still think that last.fm gives better recommendations than spotify can. I use last.fm with various music streaming services, currently Google Play Music, previously Amazon, but always using last.fm for discovering.
With the amount of users spotify has, it wouldn't surprise me to hear that it has eclipsed last.fm in terms of recommendation quality.
Leaving legality aside, I was always really impressed with the level of curation people put into that particular private tracker. You could find every vinyl and CD release of Miles Davis' Kind of Blue in just about every file format you could hope for.
I hope eventually streaming services become so low-friction and commonly used that enforcing copyright takedowns on sites like what.cd will become a thing of the past and we can benefit from their value as a deep archive of esoterica.
Uber's 2017 gross revenue was 37B to Spotify's 4B, but the valuations are 50B to 30B. Think Spotify's valuation is a little overheated?
HERE'S THE PROBLEM: Spotify doesn't pay shit to artists. They will have to increase the level of financial contribution to artists if they take this avenue.
Quote: “I can tell you that Spotify has made me about 30% more than iTunes, Pandora, Amazon, Xbox Music, Google Play, eMusic, Rhapsody, Rdio, Deezer, MediaNet, Simky, Nokia, and MySpace Music combined in that period. Even if you tack on my checks from ASCAP to that long list, Spotify is still ahead,”
You get paid proportional to your plays, so even if you're a successful drum and bass artist, you're going to struggle to be supported by your fans via Spotify than via something like Bandcamp.
That's one of the reasons I went back to buying my music from Bandcamp/Beatport. I'll contribute significantly more to the artist than I ever would via streaming, and that's important if I like their work and want them to keep producing.
I thought that Spotify didn't pay ANYTHING to artists. They pay to labels, who then pay to artists depending on their recording contract.
Could Netflix ever sign, say, Adam Sandler?
For indies that have fewer requirements, there's lots of cheaper options such as TuneCore, DistroKid, and CD baby as well.
It seems like they can and are on their way already.
For a long time we weren't seeing too many big tech IPO's. Did something fundamentally change in the market to lead to this, or did all these companies just happen to make it to "market maturity" around the same time?
If the only way is down, the price would have corrected itself to the down level already. So there is no only way down anymore.
One successful IPO will beget a whole raft of follow-ons in similar segments to profit from the 'atmosphere' as much as possible. Until the first one that bombs, then it is immediately game over. So there tends to be a bursty nature to this IPO thing.
Take a look at the 10 year S&P 500 chart:
It bottomed out in early March 2009. The period from March 2009 to right now can roughly be described as "growth." We describe it as "growth" because the overall movement is upwards. 9 years and 1 month is "almost a decade" because a decade is 10 years and 9 is pretty close to 10.
At the end of the day who really cares what is and isn't a "tech company"? Every company has a tech aspect to it these days.
If Wegman's was writing software like this (maybe they do! I have no idea) then I'd happily consider them a tech company.
But like I said, it's a silly thing to argue about anyways.
Because the way a tech company grows and a non-tech company grows are very different. Nike extensively uses software but you wouldn't call them a tech company, because their growth is limited by sales of their apparel, which is a physical good. 'Real' tech companies aren't typically limited by the distribution of their product (other than scaling issues and the like). There's (generally) nothing physical produced so there isn't a resource problem - growth can be much greater and faster.
I'll add the caveat that the product they sell or use for revenue needs to be the tech they are developing. So, once again, Nike sells athletic apparel, and while they use tech to do so, I wouldn't consider them a tech company. But Facebook and Snapchat don't sell a product (other than user info) but depend on the tech they develop to make money.
It's a fine line, but I think we can see what might divide tech and non-tech companies.
Stitch Fix has quite a team of data scientists working on their recommendation system. They typically send about 5 items per shipment, so they need to be very confident the 5 will fit, you'll like them, and you'll like the price.
With Spotify or Netflix, the user can browse around and can skip between songs or shows quickly.
If their recommendation engine wasn't phenomenal, it'd still be a viable product. Stitch Fix typically has 1 shot per month to sell you stuff you care about.
I'd argue that the logistics of shipping perishable food is significantly more difficult than streaming an audio file, and recommending clothing to meet an individual's specific style/size/gender/budget is a lot more complex than applying publicly available  Netflix-style collaborative filtering to recommend music.
You definitely have to draw the line, or else every big company in existence is a tech company. Banks hire thousands of software devs.
We are getting closer to the day where every company is a tech company. Marketing requires tech to do what is very complicated bidding and A/B testing. Most companies involved in sales are using CRM to understand how to better reach customers. This list goes on and on, as tech is embedded into everything people do these days.
When your product is software/hardware, then you’re a tech company.
If I read that correctly, it implies the bulk of the recording industry is worth less than Spotify.
Edit: and I as about growth, because I don't see how Spotify is currently worth 30B.
The more worrying thing is the consumer reports I’ve read. They said people aren’t saving money in 401ks, nor even savings accounts. This could indicate high confidence in the market. Or, it could indicate a lack of income to save. I’ve read reports indicating the later and not the former - specifically reports of people working multiple jobs to afford the basics.
If that’s the case then luxury goods and services should be commensurately lower valued. But they’re they are not.
At some point all bubbles burst.
I wouldn't be surprised, though, if less-popular tracks for artists moved to another service. You want to hear The Chainsmoker's radio singles? Play them non-stop on Spotify! But if you're a huge fan and want to hear back tracks, demos, etc, you can pay them $10/mo on a Patreon-like site. Basically, charging more for a closer relationship to studios you like, while their more popular music is released for free.
What Spotify has going for it is that indie artists can easily (or at least relatively easily) put their music up on Spotify, which bypasses the record labels. Now, not all of that music is going to be good but that is a way they are already bypassing record labels.
> According to Spotify's F-1 filing, 85 per cent of their streamed music is owned by the three major labels -- Universal, Sony and Warner -- and Merlin, a network for independents. The major labels also hold a sizable equity position in Spotify, as much as 18 per cent back 2009. This gave Spotify some help when it was renegotiating licensing deals last year. 
Which would make them (like Netflix) one exclusive content provider (potentially among many) which is fine for them if they can get good content, but not great for users who may find music fragmented like streaming video. The great thing about Spotify now is that they have access to nearly everything. Netflix has a decent streaming library of TV series, but their movie archive is terrible compared to the red envelope DVD.com option (or Blockbuster in its prime). It would be a shame for that to happen to music, too.
I don't have any reason to trust that a VC-fueled monster like Spotify understands this. If Spotify bought Bandcamp, I would remove my music from it.
VC-fueled behemoths like to make people dependent on them. I can't trust my business to a company that gets most of its money from outside investors instead of the people who use the service. Their incentives are fundamentally misaligned with my interests.
Often these are people I've sent from somewhere else, and we talk regularly. It's not like with Facebook where it's a faceless corporation unless you're spending enough on ads to get an account specialist.
They generally knew me before they gave me money. I'm not collecting any data on them other than the email. I don't even run analytics on web pages I control. I wouldn't even know what to do with it that would tell me anything I don't already know, or that I couldn't get by just asking.
Bandcamp is maybe one of the few examples of a service/shop that actually benefits artists and fans. Having them bought out by some VC tech behemoth will almost certainly see their offering ruined.
Bandcamp's site loooks like it was designed by a schizophrenic person.
A lot of music sites in general seem to prefer form over function IMHO.
Discogs.com is a notable exception of course.
Didn't Starbucks try something like that? I think it was called Hear Music.