How Spotify Became the Vital Part of Music Streaming Industry
aaamusic | On 24, Jan 2020
Spotify listed for the first time on the stock market on Tuesday, April 3, 2018. The Swedish technology company and world leader in music streaming, is worth more than $30.5 billion.
Spotify is a company that allows listeners to listen music from around the globe. Streaming has become the way to listen to music, while CD sales continue to plummet in every country in the world.
Saving the Music Sector
Spotify in a sense saved the music industry in a big way. For decades music industry was experiencing a doomed situation due to piracy. Illegal distribution, piracy became cancerous for the music industry. Spotify saved music industry from this situation with their pay per stream method.
In reality, streaming has lowered prices significantly compared to the days of CDs. Spotify today has 217 million paying subscribers, bringing its turnover to around $4.99 billion annually.
Gradually, the company has traced its path and made its way into the top of labels. Today, the biggest challenge for Spotify is to turn its free users into paid subscribers, to double its profits. They have been able to achieve a huge USA spotify plays or streaming market in the past decade.
Spotify have solved one burning issue of the music industry. Music piracy! Piracy was one of the vital reasons that was slowly absorbing the music industry. Spotify saved the industry with their pay per stream model.
Spotify: The Market Leader
Spotify competes with other paid services like Apple Music, Deezer, Google Play Music, Tidal. Spotify played a decisive role in the rebirth of the music industry. Spotify was the first to popularize the principle of subscription.
Spotify was not the first streaming service, but it is the most important, without Spotify, the music market would not have progressed. Now users can listen to their favorite titles wherever they go and on every device they have. It has become the part of the lifestyle now.
Far Ahead of the Competition
In just one year, Spotify has seen an increase in the number of paying subscribers by 40%. This increase would be due to the breakthrough of the service in emerging markets. Particularly in Southeast Asia and Latin America. Spotify is now available in 65 countries which is well above its other competitors.
Apple launched Apple Music only in 2015 and today claims 50 million paid subscribers. Whereas, amazon music have only managed to reach 20 million paid subscribers in 2018. However, Spotify still dominates the market. While for Amazon and Apple, streaming is one activity among many, Spotify is the only one of the three major players to focus exclusively on this service. If we judge the company based on the acceptance, Spotify is way ahead of other music streaming services. The popularity made spotify one of the most demanding music streaming sites in the world. Due to this popularity, competition among musicians grew significantly. Thus musicians tend to buy spotify plays to sustain the competition.
Spotify, The New Billion Dollar Company.
Entering Wall Street, Spotify joins the other unlisted technology companies valued beyond the billion dollar that have jumped in recent months, such as Snap, or the platform of Dropbox online storage. With mixed results: Snap quoted Monday at less than $ 15, against $ 24 when it entered the markets last year. In contrast, Dropbox, at $ 30, remains above its introductory price of $ 21 on March 24. Another common point: these companies have never made any profit despite hundreds or even billions of dollars in turnover. With rapid growth of the spotify company, Spotify promotion agencies that allows musicians to buy spotify plays or followers, have seen a huge spike on their revenue charts.
This technique, if we can call it so, has managed to attract more artists and listeners to join the Spotify ranks. The company took it very easy and managed to rise to the top. As we have said earlier, the company now aims to get more paid subscribers to double their profits.