Spotify files for its IPO • Hacker News Board

Re: Spotify files for its IPO

#161

Post by zanedb » Thu, Jan 04, 2018, 12:48 AM 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…

Oh no.

Let's take a second here. What will happen if Spotify signs new artists and effectively becomes their own record label?

It will start off normally, but eventually (or possibly from the start) Spotify will not allow this music to be streamed anywhere else. It will be exclusive to Spotify, the same way Netflix has done with their originals.

Now what happens? Users are forced to pay for multiple music streaming services, just as happened with the video streaming industry.

This is already a huge burden on users of video sites (and makes piracy a much more appealing option), but is not even acceptable in the music industry. Users create playlists with their own songs, and will want specific songs.

Even with your 90% statistic, which may or may not be true, the other 10% is still very important. I'd imagine that hit songs are streamed more often comparatively but older songs are more important.

Hopefully this fracturing doesn't happen, but if so (as I said) piracy certainly looks more appealing. Especially with Google Play Music allowing you to upload your own music..

Re: Spotify files for its IPO

#162

Post by hbosch » Thu, Jan 04, 2018, 12:59 AM 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.…

Well, lets also not forget that Spotify has been slowly steering itself from a pure "music playback tool" to a "music discovery tool", and a trusted one at that. They are heavily promoting things like Discover Weekly, Podcasts, playlists like RapCaviar and their various "n+Moods" and "n+Vibes" playlists.

There was a great article[0] posted here some time ago, I think, that likened the algorithmic discovery "products" of Spotify plus the effortless access to individual songs as creating a sort of thin spread of musical diversity (the auther's e.g. Muzak), generic and accessible enough to be replicated by almost anybody. A great example of this, today, is Cardi B[1] – this is a person who honed her personality through social media and reality TV, linked up with a music camp, and is now the third person in history with her first 3 commercial songs in the Billboard Top 10[2]. Her biggest hit, Bodak Yellow, uses a flow lifted from another rapper named Kodak Black (and she has done this multiple times[3]). The thing is, though, she was groomed to be a hit.

Once Spotify achieves a critical mass of listeners that trust their algorithms, and rely on their tastemakers to deliver fresh music, Spotify could easily slot in musicians that they themselves hold the contracts for. Their pockets are just as deep as a record label, and their listener data is far richer. I have no difficulty imagining that Spotify could replicate a Cardi B-esque pop zeitgeist. "Tastemaking", even if the word makes you cringe, is what will define the winners and losers of the streaming wars. It's why Apple hired away Zane Lowe – an relatively bland DJ personality, but an incredibly gifted ear and a cache of trust – and why Spotify relies more on Playlists and Discovery every day.

Remember, they didn't even have the Beatles until Christmas 2016! That shows a decent picture of how much the majority cares about back catalogues. I don't think it's unreasonable to think that Spotify themselves couldn't produce a top 10 rapper, or a top 10 country singer, or a popular podcast, just based on the level of engagement in their playlists.

0. https://thebaffler.com/salvos/the-problem-with-muzak-pelly

1. https://noisey.vice.com/en_us/article/evpbxj/cardi-bs-bodak-...

2. https://noisey.vice.com/en_us/article/bjyvad/cardi-b-makes-h...

3. https://genius.com/a/how-kodak-black-influenced-cardi-b-s-bo...

Re: Spotify files for its IPO

#163

Post by rayshan » Thu, Jan 04, 2018, 1:41 AM UTC

pducks32 wrote: post #68

mcintyre1994 wrote: post #63

Earlier quoted context omitted.

Why wouldn't everyone just go to Apple/Google Music if Spotify raised their prices? None of them have exclusive content or features that rival Netflix's exclusive library, I don't see why Spotify have any meaningful pricing power. I'm one of those people who hit OK this year when Netflix raised their price, but I'll immediately leave Spotify if they raise their prices and the competition don't - they have nothing sti…

I was agreeing with you as I read these replies but then I thought of what would actually happen if Apple Music raised their prices. I think I would stay. All the music and likes/dislikes that it has about me are a pain to move. And also I really value Beats 1 and that is worth the price raise to me alone. So maybe we really are creatures of habit.

I'm also a subscriber and love Beats 1, but I believe Beats 1 is free. Sometimes I wonder if I should just unsubscribe and listen to Beats 1 all day.

Re: Spotify files for its IPO

#164

Post by thinkmassive » Thu, Jan 04, 2018, 1:52 AM UTC

mbrzuzy wrote: post #89

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…

Good point. If Spotify started charging $15 instead of $9.99 I wouldn't care, I would still pay. They are simply the best music streaming service out there IMO. I payed for Google Music for a bit a while ago and I hated it and switch to Spotify. The experience was awful. I'm also pretty sure that Google Music rips audio from Youtube in certain cases which makes the audio quality terrible.

I also tried Google Music for a while before leaving it. They enticed me by offering to host all my MP3s, so I could stream my entire collection to any of my devices.

Later I found out they would use user uploads in their catalog (when legally able), so it sounds more likely that someone uploaded a bad copy that was shared, rather than Google ripping music from youtube.

Re: Spotify files for its IPO

#165

Post by thinkmassive » Thu, Jan 04, 2018, 1:57 AM UTC

TheHegemon wrote: post #141

mbrzuzy wrote: post #89

Earlier quoted context omitted.

Good point. If Spotify started charging $15 instead of $9.99 I wouldn't care, I would still pay. They are simply the best music streaming service out there IMO. I payed for Google Music for a bit a while ago and I hated it and switch to Spotify. The experience was awful. I'm also pretty sure that Google Music rips audio from Youtube in certain cases which makes the audio quality terrible.

> I payed for Google Music for a bit a while ago and I hated it and switch to Spotify. It's always so interesting how people can have similar experiences but come out with completely different perspectives. For me, the Google Play Radio feature is the most important thing they have. It's like a Pandora that doesn't play you the same three songs over and over. When I would try and use the radio feature on Spotify it w…

Spotify eventually makes great recommendations. The Daily Mixes (I think there's always 6) consistently deliver music I enjoy while maintaining a much better "genre theme" than anything I ever heard from Pandora.

I say eventually, because it's conditional on you using the service to seek out a variety of music you enjoy, and also on providing feedback via thumbsup/add-to-library actions. Try this for a month and you'll get good recommendations that continue improving over time.

Re: Spotify files for its IPO

#166

Post by sdnguyen90 » Thu, Jan 04, 2018, 2:09 AM UTC

Record labels are already in a dynamic where the streaming services have at least equal leverage. Playlists are already taking over radio which is where the labels would give you the most value.

More artists are publishing their music independently. I think the negotiation power of older records owned by record labels will diminish because the next generation of independently owned records will outweigh them.

The thing I'm unsure of is how Apple Music vs Spotify is going to play out. I feel that Spotify is currently an overall better product but Apple has had major cultural impact with its curation which IMO is more valuable than building software.

Re: Spotify files for its IPO

#167

Post by klarrimore » Thu, Jan 04, 2018, 2:14 AM 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…

Exactly. We have new streaming video services with their own exclusive content popping up almost daily.

Re: Spotify files for its IPO

#168

Post by wils1245 » Thu, Jan 04, 2018, 2:20 AM UTC

BinaryIdiot wrote: post #123

hobofan wrote: post #120

Earlier quoted context omitted.

> 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…

> 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.. Is that really true though? As video content gets older it usually gets watched less, becomes cheaper and gets re-aired everywhere it can. Once you watch it many don't re-wa…

I bet it’s different for various niches. Consider young families. Disney absolutely dominates children’s content, and very old content still resonates with kids. My niece and and nephew were obsessed with Toy Story, Finding Dory, Frozen, etc. I bet Disney’s streaming service will be the first one families buy.

Re: Spotify files for its IPO

#169

Post by School-Cotton » Thu, Jan 04, 2018, 2:24 AM UTC

cracell wrote: post #154

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…

I think the long term answer here is legislature that forces companies to license things for the same rate to anyone and that rate must be publicly published.

Not sure about other countries, but I'd be shocked if legislation like this passed in the United States.

Re: Spotify files for its IPO

#170

Post by IncRnd » Thu, Jan 04, 2018, 2:26 AM UTC

dragonwriter wrote: post #135

kingraoul3 wrote: post #128

Earlier quoted context omitted.

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.

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

It's a more limited piece that only talks about 15-19 year olds, which is a far smaller audience than kingraoul3's link. kingraoul3's link has data on ages 12 and older.