Monday, January 25, 2010

MIDEM 2010: Spotify don't want to get too social

There's a couple of interesting points from Spotify CEO Daniel Ek in MIDEM yesterday. Music Ally has a great report.

First is a clear-eyed explanation about what Spotify is and isn't:

Ek also alluded to Spotify’s current investment in more social features for its service, but warned that this won’t represent a complete about-turn in the company’s strategy.

“We’re looking at that quite a lot, but we’re not Pandora or,” said Ek. “I think they’re fantastic products, but what we’re trying to do… we’re really trying to drive you to create your library and to use Spotify as the cloud-based service where you have your music library.”

Although - actually - Spotify Playlists are probably one of the most successful social networking devices yet created by a music company.

Talking of which, they're hoping playlists might become more of a revenue generator:
He also promised that Spotify is looking at how to improve its integrated downloads offering, including allowing people to buy playlists rather than just individual songs.

A rebirth of the album as a form of paid-for mixtape? It still won't please the record companies - they still see an album as a way of making some money back on the duff tracks they've funded, and this won't do that. But it's still 'buying a collection of songs in one go', so it should cheer them up a little.

Playlists are also driving subscriptions, claims Ek:
He also claimed that it’s not just mobile apps driving Spotify’s customers to upgrade to the premium version:the playlists are important too. “More and more of our users are understanding and building their library in Spotify. Once they invest in that, the willingness to pay increases.”

Which carries a warning for the labels who are currently starting to mutter darkly that they don't see why they should be cutting Spotify goodwill - if people start to 'collect' in the cloud, and pay to do that, there's a real risk if the RIAA whip away the football. It's unlikely anyone would start to pay a new service to do the same thing quite so willingly if Spotify crashes financially and takes their investment and playlists with them. Even if the RIAA cartel doesn't totally care for Spotify, they need to build trust in cloud-located music collections.

1 comment:

Paul Wells said...

If the labels squash Spotify then they will effectively consign themselves to the dustbin.
The Spotify model (including we7, etc) is the most viable option for a sustainable digital music industry.
Spotify are desperate to find ways to attract people to the premium version but I think its still too expensive for many of us to bite. The 'day pass' is great for parties etc and I can imagine a time when you can pay extra to become a 'fan' of an artist, gaining early access to new releases, access to bonus 'rare' tracks etc.

My mobile provider is currently offering 2 years of spotify premium access for free on their higher end tariffs. A pretty good deal but its sobering that access to this huge library of songs (effectively the whole music industry) is now judged to be just an added sweetener on a mobile phone contract.

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