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Spotify will reduce total headcount by approximately 17%

newsroom.spotify.com

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Re: Spotify will reduce total headcount by approximately 17%

#331

Post by lotsofpulp »

capableweb wrote: post #247
hasoleju wrote: post #229

Earlier quoted context omitted.

I'm a heavy user of spotify. Almost everyone I know uses it daily. I don't understand why they are not able to turn this much engagement into profit.

Spotify is a public for-profit company with shareholders, the purpose of their organization is not to make profit so they can redistribute it, but to increase the share value as much as possible in order for the shareholders to benefit. Sometimes that means that they need to increase profits, but not always, there are other ways to increase the share value besides profits.

Such as?

Re: Spotify will reduce total headcount by approximately 17%

#332

Post by notRobot »

cedws wrote: post #321
dijit wrote: post #282

Reminds me of: "Nobody ever got fired for buying cloud". Spotify was a stand-out, almost no large tech company bought into cloud like they did, and everyone said the same thing: "It's not our core competence, it would require more people". I get it, it's not sexy at all to deal in infrastructure, but I've seen their cloud bill and it's significantly higher than 1,600 peoples jobs, even with the discounts they got thr…

This is why I'm bullish about Oxide (who are building hardware to make it easy to essentially run your own cloud.) Nobody wants to deal with the nasty parts of running servers but if a company can take some of that complexity away, you could save a tonne of money over AWS.

How is running your own cloud different than traditional bare metal?

Re: Spotify will reduce total headcount by approximately 17%

#333

Post by ghaff »

oblio wrote: post #268
byyll wrote: post #248

Can someone explain to me why a company that is about streaming mp3s needs 9500 employees? That just sounds extremely inefficient to me. They don't even have native desktop apps.

Well, this is another version of the classic "I could build this in an weekend" trope. 9500 is probably excessive, but think of it just this way: 1. Spotify has a worldwide presence, apparently 184 markets; that probably entails a legal presence in many of those jurisdictions, sales, marketing, support, localization, etc.; at a conservative 2 persons per market, just that's going to generate about 400 jobs; now, most…

And to factor in some of the other commentary--they could build this in a weekend (and continue to operate it for relative pennies) on-prem.

Re: Spotify will reduce total headcount by approximately 17%

#334

Post by chillingeffect »

schnable wrote: post #302
oblio wrote: post #268

Earlier quoted context omitted.

Well, this is another version of the classic "I could build this in an weekend" trope. 9500 is probably excessive, but think of it just this way: 1. Spotify has a worldwide presence, apparently 184 markets; that probably entails a legal presence in many of those jurisdictions, sales, marketing, support, localization, etc.; at a conservative 2 persons per market, just that's going to generate about 400 jobs; now, most…

Plus it’s a two sided market - most of that needs to be created and operated for consumer and producer side, and all the systems linking them between.

A friend there says the labels - the producer side - are very demanding to work with. That could be draining resources.

Re: Spotify will reduce total headcount by approximately 17%

#335

Post by toymin »

camillomiller wrote: post #316
kibwen wrote: post #303

Earlier quoted context omitted.

Seemingly every company in the "tech" industry is just an advertising company shambling around in the rotten skin-suit of a legitimate business.

Not Apple, IBM, Microsoft and many other that don’t make money as data merchants

> Not Apple

They're definitely moving in that direction https://searchads.apple.com/

> Microsoft

It's not a huge part of their revenue but they definitely make a sizeable amount of money from ads

Re: Spotify will reduce total headcount by approximately 17%

#336

Post by crote »

pachico wrote: post #304

Firing people is business as usual. I don't know why this is usually taken with such surprise. It's part of the life cycle of many companies to hyper-hire when money flows in, and cut lots of jobs when they "re-adjust". I don't think this is good, I personally don't like it, but I learned not to be surprised anymore. We like cloud because it scales in and out: often management don't see workforce differently.

Mass firings like these are not normal.

In countries with functional labor laws, it's straight-up illegal unless you're basically going through bankruptcy. Mass firings should only happen if either 1) there's a very significant economic crisis going on, or 2) the company is doing so poorly its immediate future is uncertain.

The Silicon Valley style mass-hiring followed by mass-firing style of management is indicative of poor management. In a well-run company this should never happen, as the same could be achieved by simply reducing the hiring rate and letting natural attrition take care of the rest.

Re: Spotify will reduce total headcount by approximately 17%

#337

Post by mrweasel »

blcknight wrote: post #309
dijit wrote: post #282

Reminds me of: "Nobody ever got fired for buying cloud". Spotify was a stand-out, almost no large tech company bought into cloud like they did, and everyone said the same thing: "It's not our core competence, it would require more people". I get it, it's not sexy at all to deal in infrastructure, but I've seen their cloud bill and it's significantly higher than 1,600 peoples jobs, even with the discounts they got thr…

Finding people who can run infra at Spotify scale isn’t easy. Even if they could find those people, it tough to leave aws (by design). They could’ve been more careful about avoiding lock-in by building more on something like kube but most startups don’t have that foresight, and the expense of moving to on-prem is compounded even more when they have so much wrapped up in the aws ecosystem.

> Finding people who can run infra at Spotify scale isn’t easy.

You won't get any argument from me on that one, but it's worth remembering that it's also hard to find people who are able to run systems in the cloud cost effectively.

Re: Spotify will reduce total headcount by approximately 17%

#338

Post by robin_reala »

camillomiller wrote: post #316
kibwen wrote: post #303

Earlier quoted context omitted.

Seemingly every company in the "tech" industry is just an advertising company shambling around in the rotten skin-suit of a legitimate business.

Not Apple, IBM, Microsoft and many other that don’t make money as data merchants

MS made $12B in 2023 from advertising: https://www.statista.com/statistics/725388/microsoft-corpora...

Re: Spotify will reduce total headcount by approximately 17%

#339

Post by steve1977 »

Shaanie wrote: post #173
steve1977 wrote: post #123

Earlier quoted context omitted.

Not OP, but I really don’t know why you would need that many people.

Obviously you don't need all those people. Almost no company apart from like one-man companies or dying companies employ only the people they need. You employ as many people as possible that generate additional profit, short or long-term. Do you need to hire a conversion specialist? Of course not, though if she costs $400k a year while improving conversion by 10% the payoff is absolutely massive, and you'd have to be…

That would maybe explain 500-1000 people.

Re: Spotify will reduce total headcount by approximately 17%

#340

Post by philistine »

throwaw12 wrote: post #329
dijit wrote: post #282

Reminds me of: "Nobody ever got fired for buying cloud". Spotify was a stand-out, almost no large tech company bought into cloud like they did, and everyone said the same thing: "It's not our core competence, it would require more people". I get it, it's not sexy at all to deal in infrastructure, but I've seen their cloud bill and it's significantly higher than 1,600 peoples jobs, even with the discounts they got thr…

> Spotify was a stand-out, almost no large tech company bought into cloud like they did Isn't this what made Spotify success? Yes, they could have build their own datacenters, but someone else could outcompete them in the meantime. They have traded off something for another thing.

I don't think one of you has to be wrong for another one to be right. Should Spotify have focused on its core competency early in its life? Sure. But at some point in the long years since, Spotify should have 100% looked at their cloud bills and built a way out of that lock-in.
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