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The clock is ticking for Spotify

bbc.co.uk

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Re: The clock is ticking for Spotify

#31

Post by delinka »

bogomipz wrote: post #14

Its worth noting that Universal, BMG, Warner Bros and EMI are all investors Spotify. It's kind of an odd situation in that respect, the labels don't need Spotify to go public but their other investors do. The big 4 record labels are the recipients of the $5 billion that the company has paid out in royalties to date. They've surely recouped any initial investment they put in by now. So they kind of have a vested inter…

With respect to accounting, you don't recoup your investment (where you purchased part of a company) by collecting licensing fees (which you'd have received anyway) from the same company.

Re: The clock is ticking for Spotify

#32

Post by bjelkeman-again »

bogomipz wrote: post #14

Its worth noting that Universal, BMG, Warner Bros and EMI are all investors Spotify. It's kind of an odd situation in that respect, the labels don't need Spotify to go public but their other investors do. The big 4 record labels are the recipients of the $5 billion that the company has paid out in royalties to date. They've surely recouped any initial investment they put in by now. So they kind of have a vested inter…

I wounded if this could be considered a cartel in this context?

Re: The clock is ticking for Spotify

#33

Post by EduardoBautista »

laurentdc wrote: post #12

Somewhat unrelated but.. is the music industry expecting that we go back to buying CDs (or $0.99 tracks) if streaming services die out? Because I'm pretty sure I won't. I can't see myself going back to physical media or DRM-laden files any soon.

iTunes purchased music has no DRM. Ironically, we have moved to prefer services with DRM.

Re: The clock is ticking for Spotify

#34

Post by abe_duarte »

bogomipz wrote: post #14

Its worth noting that Universal, BMG, Warner Bros and EMI are all investors Spotify. It's kind of an odd situation in that respect, the labels don't need Spotify to go public but their other investors do. The big 4 record labels are the recipients of the $5 billion that the company has paid out in royalties to date. They've surely recouped any initial investment they put in by now. So they kind of have a vested inter…

This is an interesting idea you put there, labels would like to see a weak Spotify.

Re: The clock is ticking for Spotify

#35

Post by bogomipz »

GrinningFool wrote: post #22
bogomipz wrote: post #20

Earlier quoted context omitted.

>"One strategy that makes sense to me is going for the Netflix model - become a "record label" themselves, sign some quality artists, help create quality music, win some grammy's and then you rid yourself of those pesky licensing issues." I think if you were at the mercy of the traditional record industry for licensing and you went an signed an artist to your label whose contract was up with say Warner Bros Records y…

But to GP's point - Netflix put themselves in the same situation in regards to their original content. While it has impacted their selection of titles from the companies they compete with, it wasn't in a catastrophic way.

I understand what you're saying and Netflix has been pretty spectacular in that regard. I think there might be a couple of differences between Spotify and Netlix though.

Record contracts are exclusive. Beyonce can't go and record an album for some other records label whereas in the Netflix model those actors aren't exclusive to Netflix. They are free to go out and make movies for Universal for 20th Century Fox when their series wraps for Netflix. As such it doesn't threaten the business model of the studios in the same way Spotify becoming a record label and paying artists directly from streams might.

The other difference I think is that consuming Netflix tends to be a concentrated experience in that you sit down to watch a movie or else you binge watch during a whole Saturday while the weather is crap. Music on the other hand is more passive. People play music pretty endlessly - while at work, on the train, at the gym. I think it would be much harder to be majority original content streaming service with music while keeping your existing subscribers satisfied.

Re: The clock is ticking for Spotify

#36

Post by disantlor »

tresante wrote: post #29

I'm a long time Spotify fan using it on everything from my Mac to our Shield TV and Echo. Music is a staple of my life and I regularly spend my working day listening to Spotify. Call me an optimist but I see a huge opportunity to capture additional $'s from less price as sensitive people like me. I'd happily hand over more money to the artists I actually like and listen to regularly but no platform gives me the means…

yes, 1000% agree. i would pay an extra $10-20 a month, especially if there was some mechanism to select which receives the extra and showing who supports which artists, etc. basically some of the ideas from bandcamp

Re: The clock is ticking for Spotify

#37

Post by x43b »

laurentdc wrote: post #12

Somewhat unrelated but.. is the music industry expecting that we go back to buying CDs (or $0.99 tracks) if streaming services die out? Because I'm pretty sure I won't. I can't see myself going back to physical media or DRM-laden files any soon.

"Somewhat unrelated but.. is the music industry expecting that we go back to buying CDs (or $0.99 tracks) if streaming services die out? Because I'm pretty sure I won't. I can't see myself going back to physical media or DRM-laden files any soon."

iTunes dropped DRM between 2007-2009. I don't think anyone is expecting you to go back to "DRM-laden files" anytime soon.

Re: The clock is ticking for Spotify

#38

Post by abe_duarte »

RamenJunkie_ wrote: post #16
danr4 wrote: post #6

One strategy that makes sense to me is going for the Netflix model - become a "record label" themselves, sign some quality artists, help create quality music, win some grammy's and then you rid yourself of those pesky licensing issues. Only problem is that they need to do it before they burn all their cash, which won't be easy.

The problem with this model, especially in music, is that music is way more reusable than a TV show. So in the end, if everyone follows this trend, you'll have to subscribe to 3-4 different services at $10/month to get a complete library, and each will be trapped into different apps, so you could end up no being able to play songs together. Unlike Netflix/Amazon/Hulu, where you could easily subscribe to or drop one m…

You are right in music the older catalogue is reused more often.

Netflix can produce a series which you will watch once and seldom see again. New content is king.

In music you mix old with new. If you lose the old content you will greatly limit the listening experience.

Re: The clock is ticking for Spotify

#39

Post by mattlondon »

Too expensive for me. When I had the Google equivalent (now cancelled too) I found that I just ended up listening to the music I already know/own anyway, so what is the point of paying to listen to the music I have as MP3s?

I've found YouTube has been a great replacement for listening to any music I don't already own.

Re: The clock is ticking for Spotify

#40

Post by bogomipz »

nine_k wrote: post #21
bogomipz wrote: post #15

Earlier quoted context omitted.

>"I can't be the only one that has almost zero faith the music industry won't ruin Spotify?" But will it be the music industry ruining Spotify if that happens or will it simply be a failure of the business model? You could certainly argue the latter.

Is dealing with the music industry, which cranks licensing costs up every year, a failed business model? Maybe. Spotify is allowed to live but not to thrive.

>"Is dealing with the music industry, which cranks licensing costs up every year, a failed business model?"

I think it could possibly be. Nobody has been successful yet at least that I can think of. I think the problem is the better you do the more those licenses will cost. I am trying to think of another industry that works that way. I guess cable is similar with content in that the more subscribers a cable operator has the more expensive licensing the content is. So maybe licensing entertainment content is just a very constrained business model?

I can't imagine if I ran a restaurant and my costs from my food purveyors increased with the success of the restaurant. I think it would be very difficult to make a go of that.

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