Spotify This

Spotify has long been admired for its product development methodology by digital product managers and also loved for the product by its users. Yet despite the company's scale (30% market share in music streaming), the Swiss company has struggled to consistently earn a profit.

So, over time Spotify has spawned several forays into new territory including direct artist uploading of music, podcasting, concert ticket merchandising, artist merchandise sales, and audio books. It feels a bit like Amazon’s early years- Can’t make money selling books? add toys… still can’t make money? add household goods… still no? add everything. And finally all the Amazoning of this and that worked. Really well.

THE QUESTION: With competitors like Apple, Google, and yes, Amazon, what are Spotify’s prospects as a stand-alone business regardless of how much Spotifying of this and that it does, or is its destiny to be absorbed by someone like Netflix as part of their own “Netflix this” strategy?

Bill Haines, Partner