Spotify files for its IPO • Hacker News Board

Re: Spotify files for its IPO

#111

Post by BinaryIdiot » Wed, Jan 03, 2018, 9:05 PM UTC

philfrasty wrote: post #41

Is there anything to expect from Spotify aside from music streaming? Anything that might differentiate them in the long run? Seems really hard to build a sustainable music-streaming business when all major competitors can simply subsidize this rather complementary part of their business (AZ, Apple, etc.).

At one point I thought they were positioning themselves to be THE premier, one stop shop for all listening, when they added podcast support and were planning on more. But it's been at least a year since they added Podcast support and it's frightfully bad. I tried to use it for a week and it was just so terrible and lacked all of the basic features of any other podcast app.

I'm not convinced they can do anything else successfully to be honest. At least I'm not impressed with some of the newest stuff like podcasts.

Re: Spotify files for its IPO

#112

Post by mavelikara » Wed, Jan 03, 2018, 9:07 PM UTC

fragsworth wrote: post #83

nunez wrote: post #59

Earlier quoted context omitted.

It’s really not though because music is a loss leader for amazon, apple and google, but it is spotify’s entire business. The only other major competitors out there are either in major cahoots with the big 3 (tidal, pandora) or gone (soundcloud, grooveshark, rdio). Netflix has this problem too but they “solved” it by making their own content. Amazon are Google are doing the same thing. That’s the direction I see Spoti…

Music is quite a bit different, in that people spend lots of time curating their own playlists and they listen to the same songs repeatedly. It is incredibly annoying to have songs that you want in your playlists but can't get, EVEN if you pay for multiple services. Making their own content for video has the advantage that most people are OK with opening a new browser tab or an app to watch a specific movie or show.…

You argument works in favor of Spotify too.

If they sign on 100 top artistes, it will devalue the portfolio of music held by the top 3 - for reasons you explained. Thus, the top 3 are incentivized to collaborate with Spotify.

Re: Spotify files for its IPO

#113

Post by mickronome » Wed, Jan 03, 2018, 9:08 PM UTC

lerie82 wrote: post #81

I'm not a business major but releasing their IPO while being sued for billions sounds like a bad idea. Someone please explain this to me.

My very non-qualified thoughts about this, I'm definitely out of my depth here, but it's kind of fun to think about these things :)

Not releasing it as planned could very well be worse. It could easily be seen as an implicit acknowledgment that the plaintiff has legal standing, and that their claims have merit. This could then lead to a situation where an IPO would have to be delayed, potentially for years until it all has been played out in court.

I'm quite sure most potential investors will assume that this particular suit is likely to be timed based on rumors of the IPO to interfere maximally with it. Maybe in the hope of either a quick settlement or to effectively create an out-of-court punishment via lowered IPO valuation to deterr others from trying to manuever the legal terrain in a similar way as Spotify is claimed to do. Whether the plaintiff has standing or not.

Going forward without deviating from schedule, or even quicker than schedule, sends what is probably the strongest possible message that could be sent to bolster the IPO and minimise value loss. It says: "We're not afraid of this suit"

Risk estimates in preparation for an IPO regarding a company like Spotify almost certainly includes assesment of risks by various actors that might want a piece of the cake through legal action.

Re: Spotify files for its IPO

#114

Post by SnowingXIV » Wed, Jan 03, 2018, 9:09 PM UTC

notyourwork wrote: post #43

SnowingXIV wrote: post #42

I hope they do get funding so they can support messaging again, one of the reasons I came back to Spotify was for one of my most beloved features. Sending tracks to friends within the application, but then found out it was removed. I still subscribe to Spotify, but the "copy link" send to friend via text is so much worse than being able to just message within.

Can I ask for more context on why you feel there is friction to this route? It seems most mobile applications are moving towards a route where you can share in app content via other messaging mechanisms (sms, gchat, iMessage, etc.)

Sure, it was a great way to message a friend specifics songs or playlists(?) and you could hit play from the message itself in spotify and have a quick dialogue on it. Super enjoyable to scroll back in time and hit play in the messages and hear the songs we've been sending. Now when I get a text of the song being shared I have to wait until I get to a computer and then copy the link and send myself an email or something? Makes it way harder and often I just won't listen to the song that my friend or colleague sent me because it's too much friction. If I do, I end up searching for it manually and then what's the point even.

Re: Spotify files for its IPO

#115

Post by komali2 » Wed, Jan 03, 2018, 9:19 PM UTC

BinaryIdiot wrote: post #108

pembrook wrote: post #54

Earlier quoted context omitted.

This is the same problem Netflix & Amazon have been successful in combating. The answer is to become a content owner by competing with the big labels directly. All Spotify needs to push the big labels back on their heels is to sign a few top 40 artists of their own. I might be wrong but I remember reading something like 90%+ of streams on music services are of songs currently on the charts. Capture the popular cultur…

> This is the same problem Netflix & Amazon have been successful in combating. The answer is to become a content owner by competing with the big labels directly. > All Spotify needs to push the big labels back on their heels is to sign a few top 40 artists of their own No way that's going to work. Music is VASTLY different from video. In video it takes more time and resources to produce each one and replays are rare.…

Alternatively, as less people stop listening to the radio, songs from the 70's, 80's, 90's, and eventually the early 2000's will need a venue to be played on.

If less people listen to the radio, AND less people buy music directly through itunes or whatever, the only option the big 3 will have is to work with streaming services.

Re: Spotify files for its IPO

#116

Post by hobofan » Wed, Jan 03, 2018, 9:21 PM UTC

pembrook wrote: post #54

_whm1 wrote: post #46

I don't think this is a good long term investment. Disclaimer: I worked for a Spotify competitor in the past, so i have a pretty solid understanding of how the business works. I think it is a bad investment for one simple reason: Spotify purchases its main product (music) from a oligopoly. I'd estimate that 95%+ of the tracks streamed (by total playtime) are from one of the 3 major music labels: Universal, Sony or Wa…

This is the same problem Netflix & Amazon have been successful in combating. The answer is to become a content owner by competing with the big labels directly. All Spotify needs to push the big labels back on their heels is to sign a few top 40 artists of their own. I might be wrong but I remember reading something like 90%+ of streams on music services are of songs currently on the charts. Capture the popular cultur…

> This is the same problem Netflix & Amazon have been successful in combating.

I would say that the jury is still out on that. Lack of Blockbuster movies has always been one of the weak points of Netflix, and they are still in the process of getting started with producing content there (with "Bright" being one of the first of their movies trying to be a Blockbuster).

On the other front, they are highly dependent on existing content that people love, and more and more of that is being owned by Disney and pulled from the platform as they are gearing up for their competing service. If they also fail to keep the other big right holders on the platform then soon all they have will be Netflix content (which is probably their 5-10 year plan anyway since that makes them more profitable).

I'm not sure a Netflix Originals-only catalog will go over well with the subscriber base. Despite some of their first original content having some good hits (e.g. House of Cards), I think over time their hit-rate pretty much adjusted to the levels of traditional cable channels like HBO/Showtime with a lot of mediocre content.

Re: Spotify files for its IPO

#117

Post by bedhead » Wed, Jan 03, 2018, 9:22 PM UTC

BinaryIdiot wrote: post #110

bedhead wrote: post #66

Earlier quoted context omitted.

Same reason people don't move from Amazon to Wal-Mart, or Apple to Android, or Netflix to...I don't even know what. Spotify is objectively better as a service, people love it, and we are creatures of habit. There are other factors like social and all the playlists you've created. Besides, people derive value from things based on more than price alone. You might not see why they have pricing power but the fact is they…

> Same reason people don't move from Amazon to Wal-Mart, or Apple to Android, or Netflix The big difference is Apple has its own ecosystem, Amazon and Wal-Mart sell a lot of different stuff, Netflix has a TON of original shows to differentiate itself from Hulu and others. Spotify? They literally offer the identical catalog of music as everyone else. Literally. Sure their apps may be slightly better but who cares? If…

Then why is Spotify so freakin popular? Why do they have more than double the subscribers as Apple Music which arguably has major advantages (resources, pre-installed, etc)?

Re: Spotify files for its IPO

#118

Post by Reeeee » Wed, Jan 03, 2018, 9:23 PM UTC

_whm1 wrote: post #46

I don't think this is a good long term investment. Disclaimer: I worked for a Spotify competitor in the past, so i have a pretty solid understanding of how the business works. I think it is a bad investment for one simple reason: Spotify purchases its main product (music) from a oligopoly. I'd estimate that 95%+ of the tracks streamed (by total playtime) are from one of the 3 major music labels: Universal, Sony or Wa…

Keep in mind that Universal, Sony, and Warner all own a chunk of Spotify.

Re: Spotify files for its IPO

#119

Post by Fnoord » Wed, Jan 03, 2018, 9:25 PM UTC

eropple wrote: post #75

charlesdm wrote: post #72

Earlier quoted context omitted.

It just works -- pretty much exactly the way I want it to. I've been a Spotify user for 5 years, have occasionally tried competing services, but I've never cancelled my subscription. Even if they'd double the price, I wouldn't cancel my account.

I had a six month trial of Google Music and YouTube Red, thinking I'd go to that instead of Spotify. I canceled the Google one because changing over was too much effort.

Are there scripts to aid changing services to convert playlists etc? That'd increase competition and decrease lock-in.

If I change password manager there are scripts. If I change browser there's addons for the other browser as well. [...]

Re: Spotify files for its IPO

#120

Post by hobofan » Wed, Jan 03, 2018, 9:30 PM UTC

BinaryIdiot wrote: post #108

pembrook wrote: post #54

Earlier quoted context omitted.

This is the same problem Netflix & Amazon have been successful in combating. The answer is to become a content owner by competing with the big labels directly. All Spotify needs to push the big labels back on their heels is to sign a few top 40 artists of their own. I might be wrong but I remember reading something like 90%+ of streams on music services are of songs currently on the charts. Capture the popular cultur…

> This is the same problem Netflix & Amazon have been successful in combating. The answer is to become a content owner by competing with the big labels directly. > All Spotify needs to push the big labels back on their heels is to sign a few top 40 artists of their own No way that's going to work. Music is VASTLY different from video. In video it takes more time and resources to produce each one and replays are rare.…

> If Spotify became their own label and signed 100 of the top artists, their old songs are STILL with the previous label and will likely never leave. Spotify still NEEDS those songs or it's SOL.

As I pointed out in a sibling comment, I think Netflix actually has the same problem. There is a significant presence of long-running shows that people love to watch on Netflix: Friends, Breaking Bad, Modern Family, How I Met Your Mother, etc.. A big favorite "It's Always Sunny In Philadelphia" just left the catalog - presumably due to the acquisition of FX by Disney - and "Archer" will likely soon follow for the same reason.

A lot of those are not new and people still watch them (either to catch up on a missed cult hit or to rewatch their favorites), and the will continue to do so for the next 10-20 years. As long as that's the case Netflix also has to continue to make deals with the existing rights holders or substantially shift their core offering.