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Spotify files for its IPO

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Re: Spotify files for its IPO

#101

Post by notatoad »

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.…

Yes, i don't think the original content strategy will work out for streaming sites the way it has for netflix and amazon. I'm not willing to open one app to listen to one album and then another app to listen to a different album. I'll use the service that has all the music i want to listen to. Whether that's piracy or youtube playlists or spotify. If any streaming service starts getting too many exclusives, it's going to just kill the entire streaming market.

From my perspective, all the streaming services should be working together to create a healthy marketplace for independent music, and providing every opportunity they can for musicians to avoid signing a big-four contract. If Warner and Sony, and UMG get their act together and create a joint venture streaming service that's the exclusive host of the content they own, Spotify, Google Music, and Apple Music are screwed.

Re: Spotify files for its IPO

#102

Post by nofilter »

yeukhon wrote: post #69
_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 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.

Re: Spotify files for its IPO

#103

Post by notatoad »

nkozyra wrote: post #73
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…

I'm confused. I think you're saying the same thing as the post you're replying to. The direction would be to own (or "create") the content. In other words, Justin Timberlake or someone with equal clout moves from Sony to Spotify Records (for lack of a better name).

The problem with that is it creates a war for exclusives. If their competitors start doing the same thing, spotify will just end up losing a lot of their content.

and personally, unless spotify continues to have the vast majority of the music i want to listen to, i won't continue being a subscriber.

Re: Spotify files for its IPO

#104

Post by dragonwriter »

kingraoul3 wrote: post #100
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…

What about iHeart? They do own half the physical radio stations in the country which is still how people find new music, you know.

> They do own half the physical radio stations in the country which is still how people find new music, you know.

IME, lots of people find new music by genre/mood/etc. curated or “like this song/artist” algorithmic stations in streaming services, not terrestrial radio.

Re: Spotify files for its IPO

#105

Post by kingraoul3 »

oli5679 wrote: post #36
JonFish85 wrote: post #14

Isn't the point of an IPO generally to raise funds? In this case, it's just allowing people to sell their shares to the public, right? From the company standpoint, this is almost certainly a negative: additional oversight & reporting to do, no funds raised. I guess a positive is that shareholders can cash out, but as an investor, isn't that a giant red flag? I guess as an investor, I don't see why I'd buy Spotify sha…

One advantage a new investor has over someone who provided Spotify with Seed/Series A is greater diversification. Suppose I'm a VC that invested in Spotify, it succeeded and my 20 other seed investments all failed. My retirement wealth is entirely dependent on it's success in the future - your comment outlines why this is risky. Since I am risk averse, I can sell this to a pension fund who will keep it as 1% of their…

That can be accomplished with private market tenders though.

Re: Spotify files for its IPO

#106

Post by kingraoul3 »

dragonwriter wrote: post #104
kingraoul3 wrote: post #100

Earlier quoted context omitted.

What about iHeart? They do own half the physical radio stations in the country which is still how people find new music, you know.

> They do own half the physical radio stations in the country which is still how people find new music, you know. IME, lots of people find new music by genre/mood/etc. curated or “like this song/artist” algorithmic stations in streaming services, not terrestrial radio.

That is not supported by the data. The lions share of new music discovery is still done via terrestrial radio, and the brand identification people have with their favorite stations is crazy high

Re: Spotify files for its IPO

#107

Post by dragonwriter »

kingraoul3 wrote: post #106
dragonwriter wrote: post #104

Earlier quoted context omitted.

> They do own half the physical radio stations in the country which is still how people find new music, you know. IME, lots of people find new music by genre/mood/etc. curated or “like this song/artist” algorithmic stations in streaming services, not terrestrial radio.

That is not supported by the data. The lions share of new music discovery is still done via terrestrial radio, and the brand identification people have with their favorite stations is crazy high

Where is the data showing this?

Re: Spotify files for its IPO

#108

Post by BinaryIdiot »

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. 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. In music everything is super cheap to produce and replays are off the chart.

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.

Re: Spotify files for its IPO

#109

Post by on_and_off »

kinkrtyavimoodh wrote: post #76

Anyone feel worried about an environment where your competitor products are basically all propped up by big companies who couldn't care less whether they made money as long as they fly low of the anti-competitive radar? Of course your lemonade stand can sell lemonade for a cent a cup if your rich daddy will pay the other 99 cent from his pocket. For eg. Spotify had to lower their price from $10 per month to $15 per m…

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 differentiate as a music service. Most of the features are present in all the services (albums, playlists, AI generated recommandations, radios, podcasts, etc) .

Regarding the price, it is up to Spotify to start creating its own content in order to make it go down. Right now the real issue IMO is that the majors are dictating an extremely high monthly price for the service.

Re: Spotify files for its IPO

#110

Post by BinaryIdiot »

bedhead wrote: post #66
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…

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 they raised their prices why not move to the more native solution your platform offers for cheaper? Google Music, Apple Music, Microsoft Groove (lol), Amazon Music; they all offer the same damn thing.

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