According to
this article, Spotify isn't doing very well. When you look at the
pink bubbles here you understand something is very wrong with that picture.
I'm by no means an analyst but I think the problem is simple and it is called 'unlimited'. I never understood why a service like Spotify need to be unlimited and I thought it was a stupid move from the beginning. I can imagine they needed to boost their subscription numbers and came up with this; it looks nice in advertisements, but I don't think they realized what the effect would be to their business on the long term. I believe the unlimited accounts are the cause for Spotify's payouts to be spread so thin.
See, with unlimited accounts, whether they are free or paid, you take away a sense of value for the music a customer is playing. The value is in the service, not the music itself. This is the issue at hand, I believe. If a paid account was limited, not in play time but lets say in number of songs they can add to playlists each month, you would force customers to think about what they wanted to play and bring back the sense that their money is for the music they listen, and not for an unlimited service. It is simply not right to allow a customer to play millions of songs for just 10 dollars.
Add to that the fact that a played song from a free account is basically paid to artists by the paying Spotify customers, you can see that the payouts from Spotify are not going where they should be going. This is the reason I don't have a Spotify account; I don't want my money going to artists that I don't support and I believe that by using a free Spotify account, I am adding to their problems.
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Topic: Spotify's unsustainable business model (Read 888 times)