Spotify files for its IPO • Hacker News Board

Re: Spotify files for its IPO

#131

Post by pembrook » Wed, Jan 03, 2018, 9:51 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.…

But if the majority of plays on Spotify are of the current hit pop songs at any given time, Spotify still has the power even if they don’t own the old songs.

Go look at the most played songs on Spotify of all time. It’s not the Beatles and Michael Jackson’s back catalog. We’re talking Chainsmokers and Imagine Dragons and Ed Sheeran.

Re: Spotify files for its IPO

#132

Post by noxToken » Wed, Jan 03, 2018, 9:52 PM UTC

hobofan wrote: post #116

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. 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 e…

If Netflix went to in-house only, then they could significantly (I assume) drop the price. Part of Netflix's big expense is licensing content. If all of the major players are pulling content, then the licensing costs for all of that content disappears as well.

Re: Spotify files for its IPO

#133

Post by ErikVandeWater » Wed, Jan 03, 2018, 10:06 PM UTC

bedhead wrote: post #60

_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…

I think this has a good chance of being a good long-term investment for one simple reason. Spotify has something that few companies have but all dream of: pricing power. The other week, my kids were watching TV and my wife and I were in the kitchen and one of them yelled out, "Mom, something popped up on Netflix saying the price is going up. What should I do?" My wife and I said the same thing instantly: "Just hit ok…

>The other week, my kids were watching TV and my wife and I were in the kitchen and one of them yelled out, "Mom, something popped up on Netflix saying the price is going up. What should I do?" My wife and I said the same thing instantly: "Just hit okay." We didn't even know what it went up to...hell I don't even know what it cost before.

You and your wife both know (subconsciously at least) that people will switch to HBO, Hulu, or any other number of services if Netflix gets unreasonably expensive. It's broke college students that buy Netflix the most, and they would have to get rid of their biggest set of subscribers to raise prices significantly.

Re: Spotify files for its IPO

#134

Post by hobofan » Wed, Jan 03, 2018, 10:12 PM UTC

noxToken wrote: post #132

hobofan wrote: post #116

Earlier quoted context omitted.

> 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 e…

If Netflix went to in-house only, then they could significantly (I assume) drop the price. Part of Netflix's big expense is licensing content. If all of the major players are pulling content, then the licensing costs for all of that content disappears as well.

With shared accounts, the price is already pretty low at ~3-4€/person/month. I don't think that a price drop would adequately compensate for a significant loss in content at such a low price point.

Yes, in the long run producing their own content will be cheaper. Mid-term buying proven content will probably come out at around the same price as producing new content that the viewers may or may not like. They have better viewer analytics and better ways to globally monetize the content than traditional content producers though.

Re: Spotify files for its IPO

#135

Post by dragonwriter » Wed, Jan 03, 2018, 10:17 PM UTC

kingraoul3 wrote: post #128

dragonwriter wrote: post #107

Earlier quoted context omitted.

Where is the data showing this?

https://www.digitaltrends.com/mobile/radio-still-beats-digit...

So, here's a newer piece, with opposing results:

https://musicbiz.org/news/music-bizloop-study-millennials-tu...

But it looks like the data from other recent sources are mixed, with different surveys posting widely varying data, consistent in the direction of change from radio to streaming) but not what the current leading discovery sources are or even the relative placement of streaming vs. radio.

Re: Spotify files for its IPO

#136

Post by bedhead » Wed, Jan 03, 2018, 10:17 PM UTC

ErikVandeWater wrote: post #133

bedhead wrote: post #60

Earlier quoted context omitted.

I think this has a good chance of being a good long-term investment for one simple reason. Spotify has something that few companies have but all dream of: pricing power. The other week, my kids were watching TV and my wife and I were in the kitchen and one of them yelled out, "Mom, something popped up on Netflix saying the price is going up. What should I do?" My wife and I said the same thing instantly: "Just hit ok…

>The other week, my kids were watching TV and my wife and I were in the kitchen and one of them yelled out, "Mom, something popped up on Netflix saying the price is going up. What should I do?" My wife and I said the same thing instantly: "Just hit okay." We didn't even know what it went up to...hell I don't even know what it cost before. You and your wife both know (subconsciously at least) that people will switch t…

First of all, the "broke college students" quip is wrong. Generally, Netflix's subscribers are fairly well off (in the US anyway). Second, even if that was the case, I can assure you that said college students would suck it up and pay the extra $5-10/month. This extra cost isn't putting anyone into bankruptcy. Netflix has raised prices several times and subscribers keep increasing. And people are just getting more addicted to it. And the competitive advantages is getting larger. And the (good) alternatives are getting fewer.

"Unreasonably" is the key word there. What is unreasonable? I think that for the vast majority of subscribers, they get FAR more than $10/month in value (or whatever it costs). Cable costs something like $100/month and it's arguably far worse of a product. Is $50/month for Netflix unreasonable? For some I suppose, but for most I'd be willing to bet no. Remember Ballmer saying no one would pay $500 for a phone? :)

Re: Spotify files for its IPO

#137

Post by Disruptive_Dave » Wed, Jan 03, 2018, 10:26 PM UTC

Exuma wrote: post #49

_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…

So how do their competitors deal with this?

Music was never intended to be a revenue generator for their competitors.

Re: Spotify files for its IPO

#138

Post by TallGuyShort » Wed, Jan 03, 2018, 10:30 PM UTC

aceofspad4s wrote: post #58

urda wrote: post #56

Earlier quoted context omitted.

> A lot of music was removed Citations please. > They added really bad limits, like a limit on how many hours you could listen every month. Just wrong. > They forced you to create Facebook accounts to register Also completely wrong. > which means I had to create tons of Facebook accounts to overcome the hours/month limit. This is also wrong because the previous two statements were also wrong. > And some other things…

They removed those limits years ago. But they were added just when they launched in the US. https://www.wired.com/2010/05/spotify-adds-us-friendly-servi... "Meanwhile a new free version called Spotify Open allows Europeans who had not been invited to sign up for free accounts in the past to join without being invited – however, they can only stream up to 20 hours of free music per month, with advertisements." This is…

It sounds like your complaints basically boil down to terms being changed for new accounts. And you don't sound like a paying customer. If I were a betting man, I would bet that you would probably be dissatisfied with literally anything that wasn't just giving you free music on whatever terms you'd like.

Re: Spotify files for its IPO

#139

Post by yeukhon » Wed, Jan 03, 2018, 10:33 PM UTC

nofilter wrote: post #102

yeukhon wrote: post #69

Earlier quoted context omitted.

I work for one of the big three, though just a technical staff, so I am no where close to knowing the full details of how licenses are signed, but enough to understand at the high level. I see your points and I think they are very real. Streaming is one of the biggest sources of revenue today for the major players. Territories in music industry is what's squeezing business like Spotify. You can have a deal such that…

You're confusing iTunes with Apple Music. iTunes Music was where you bought songs and albums. Apple Music is a streaming service just like Spotify where you pay monthly to have access to all of the music.

Thank you for the correction. Indeed. iTunes from years ago.

Re: Spotify files for its IPO

#140

Post by on_and_off » Wed, Jan 03, 2018, 10:43 PM UTC

joethebro wrote: post #130

on_and_off wrote: post #109

Earlier quoted context omitted.

Disclaimer : I worked for one of Spotify and Google competitors. >Most people would agree that Spotify is a better music player while each of Google's music apps are bad in different ways I am not so sure about that. Spotify is on top of its game : adjusting the loudness of tracks, using ogg, .. I am however pretty sure that to almost all the users, it makes no difference. Furthermore, it is very hard to differentiat…

I'd argue however that Spotify's song recommendation engine is one of its differentiating factors. I'm always hearing friends rave about how much they love each weeks discovery weekly playlist.

AFAIK all of the major players have this feature and even developed it a while ago :

Google Music have been displaying some kind of 'I feel lucky' button for ages (it is not random but based on your listens). They also had artists maps years ago.

Deezer has its Flow

Apple Music has 'for you'

Etc ..

There are many variations in how these recommandations are surfaced to the user though.

I would be hard pressed to recommend one service over another as far as their quality. It is just all over the place depending on your tastes, listening styles and how much new tracks you want to listen to.

IMO Spotify has mostly found a sweet spot in how to present these results to the user.