Streaming wars: The precarious position of Spotify

100 million subscribers and a valuation of $8 Billion dollars, Spotify are the aristocrats of the streaming market.

Afo
Afo
Feb 13, 2017 · 3 min read
(Illustration by osheyi.a)

The Swedish company have been riding high and are giving Silicon Valley veterans a run for their money. But something tells me that this can’t continue.

Spotify went to market in 2008 and an inside source informed me that they hired Raven to look into the future of music consumption. One would have you believe that their competitors are playing catch up, I’m going to show you why Spotify are in fact the chasing pack.

Apple and Google. Fellas, think about it like the girl that is supposedly too good for you or ladies the Viva glam lipstick by Taraji P. Henson from Mac that you want but is too expensive (I was on the Mac site for research purposes!). These two heavyweights have been prospering for a long time and have been able to establish themselves in different sections of technology and been successful! This gives them the ability to build their ecosystem! Spotify’s problem is that their core is music which has not been fully used to delve into other avenues. Spotify may have went to market first in the streaming field but Apple and Google have entered the market with a juggernaut of resources and cash to compete comfortably.

Original content! Apart from just music, Spotify’s rivals offer more than just that. Google have Youtube, Fin!

Talk of Apple providing original content has been been on the interweb for a while now but Jimmy Iovine, an Apple exec and former head of Interscope records was speaking with Digital trends and had this to say on the very matter,

“At Apple Music, what we’re trying to create is an entire cultural, pop cultural experience and that happens to include audio and video. If South Park walks into my office, I am not going to say you’re not musicians, you know? We’re going to do whatever hits popular culture smack on the nose.”

On my podcast, we had Andrew Davis (former producer at BBC 1xtra) on the show and spoke on establishing the core of your business and once that has been done then you can make changes to the edges. Google’s core is Search, Apple’s core is mobile computing (Mobiles, MacBooks), they established themselves in these markets and are now improving their edges.

According to Statista, Spotify have 40 million paying customers and they launched in 2008. Compared to Apple, according to The Verge, have 20 million subscribers having only launched in June of 2015. How were they able to achieve that number in such little time? With the acquisition of stars such as Drake, this may have played part! Or how about convenience? If you’re an iPhone user, it’s a tad easier to be drawn to Apple music over Spotify, the same can be said about Android users, the apps are already there to utilise their services. This further shows the use of Apple and Google’s ecosystem to their advantage.

Spotify’s precarious position doesn’t have anything to do with them being dominant in music, they are and they will continue to do so but it’s about transition. Music is an door to delve into other avenues which leads towards building an ecosystem. The issue that they will face is that they will be competing with well establish companies that have already made that transition and unfortunately for Spotify, that’s where they will start to see problems.

FWRD

A community of forward thinkers, expressing themselves beyond the limitations of 140 characters. Encompassing tech, life and culture. Driven by authenticity, creativity and great storytelling. Lets move FWRD, together.

Afo

Written by

Afo

FWRD

FWRD

A community of forward thinkers, expressing themselves beyond the limitations of 140 characters. Encompassing tech, life and culture. Driven by authenticity, creativity and great storytelling. Lets move FWRD, together.