Spotify was able to change and disrupt the whole music industry with its streaming platform. The big piracy problem within the music industry got reduced by the emergence of Spotify since more and more people were willing to pay for the music streaming service. Spotify was capable of connecting the listeners and producers within their platform. In return of a small fee, listeners received unlimited access to a large database of music and the producers got a compensation for providing their music on Spotify. The company has currently a value of more than $23 billion (BBC 2018).
Spotify counts 217 million monthly active users nowadays, whereby 44% of its users listen to Spotify on a daily basis. The average amount of hours spent listening to the app is 25 hours per month. In 2018, 10 years after Spotify was launched, the total time streamed on Spotify was 16,858,080 years (Spotify 2018). Based on this, you can conclude that the volume of the data that Spotify has gathered over time is enormous.
A few years ago, Spotify started using this data for creating personal playlist such as Your Daily Mix, Your Release Radar, and Your Discover Weekly. However, it is also expanding their personalization without you even noticing. At this moment, Spotify is experimenting with making popular human curated playlist like ‘Happy Hits’ or ‘RapCaviar’ partly human curated and partly personalized with algorithms. This experiment resulted in 80% more seeking out songs after listening to them in personalized playlists and 66% more songs were saved. By personalizing its playlist, Spotify can offer new artist the opportunities to promote their music by the right audience which will increase their streaming and popularity in new countries (Kastrenakes 2019). Personally, I am very happy with how well Spotify knows my music taste and is able to introduce me to new songs and playlists. However, at the same time it feels like Spotify knows you sometimes better than you know yourself. I am very curious how far companies, such as Spotify and Netflix, will go with hyper personalization and when the limit will be reached.
Reference:
BBC (2018) ‘How Spotify came to be worth billions’. Retrieved from: https://www.bbc.com/news/newsbeat-43240886
Kasternakes, J. (2019) ‘Spotify is personalizing more playlists to individual users’. Retrieved from: https://www.theverge.com/2019/3/26/18282549/spotify-personalized-playlists-curation-more-songs
Spotify (2018) ‘Celebrating a Decade of Discovery on Spotify’. Retrieved from: https://newsroom.spotify.com/2018-10-10/celebrating-a-decade-of-discovery-on-spotify/
Hi Manon!
Interesting blog topic 🙂
Along with many others, I use Spotify on a daily basis too. Most of the lists I listen to are created/controlled by Spotify, and the music really fits my interests. I think for consumers like us it is very ideal that Spotify “learns” what we like and recommends songs to us. But doesn’t this create an environment in which we become dependent of Spotify? For us this may not be too bad, but if all we listen to is the music that Spotify recommends to us because it’s easy and it fits our taste, what does this mean for music producers/artists? Are they going to have to pay big amounts of money to be able to reach us? Doesn’t this take the platform out of balance and give a lot of power to Spotify? These are just some things that came to mind when reading this, feel free to reply with your thoughts 🙂
Hi Kim!
That is an interesting perspective. I did not look at the company from the producer perspective.I found in a news article by CBC (2018) that Spotify pays $0.006 to $0.0084 per stream to the holder of music rights. The song ‘Shake it off’ by Taylor Swift with 46.3 million streams raised $280,000-$390,000 which needs to be shared among producers, songwriters and artist of the song. I agree that Spotify has a lot of power over producers/artists since it dominates the music streaming market. However, I also think that Spotify did help these producers/artist with the piracy problem.
CBC (2018): https://www.cnbc.com/2018/01/26/how-spotify-apple-music-can-pay-musicians-more-commentary.html
Hi Manon!
Thanks for your interesting insights on the knowledge of Spotify. I agree with your concerns regarding the availability of personalised playlists, created by algorithms. However, due to our online behavior it became inevitable for companies to take advantage out of this. In addition, Spotify is adding value for customers by personalizing to our preferences and tastes.
In contrast to the added value for customers, the rise of Spotify is a big concern for everyone within the music industry. Where artists used to tour around the world to promote their music, bringing out an album is currently the way to make money, as they only earn a very limited amount of money of streaming services like Spotify. Consequently, the main focus of musicians is shifting from making authentic music, to making music for a large audience.
Although, the emphasis should be on the quality of the music, my worry is that, as with most powerful and influential institutions, Spotify has became too large to change this.