5 interesting facts about Spotify
Spotify finally launches in Australia after much anticipation.
The sweden-based live music streaming company offers 16 million songs under a "freemium" model which gives subscribers the choice of listening for free with advertisements or paying to upgrade to ad-free and mobile-based services.
Here are 5 interesting facts published on Smart Company which I came across when researching about Spotify.
1. Sean Parker helped get Spotify off the ground
Sean Parker co-founded Napster in the 1990s, the first popular application that allowed users to share music files over the internet.
He was introduced to the service in 2009, and contacted founder Daniel Ek. Soon after, Parker invested $15 million in the company and now sits on the board.
He was influential in establishing a partnership between Facebook and Spotify, which is now a key part of the service – users need a Facebook account to log in.
2. Surprise, surprise – it hasn’t made a profit
Like many other tech companies, Spotify isn’t profitable. Across the world it has three million paying customers, and it makes money from revenue, estimated to be about $US900 million. A $US100 million investment last year pegged the company’s valuation at $US4 billion.
Last year, Ek said the company took a $US60 million loss – it’ll be a while before Spotify follows Facebook and completes an initial public offering.
3. The music catalogue has some restrictions
Spotify prides itself on having a huge catalogue of music available for streaming. But it doesn’t have everything.
Currently the catalogue sits somewhere in the region of 16 million songs. But there are many that aren’t on there, including the Beatles, who have an exclusive deal with iTunes. Many other users have become frustrated about the lack of lesser-known artists, who may not have struck deals with the company to include their music.
4. It’s run by a 28-year-old whiz kid
Daniel Ek, the entrepreneur who created Spotify, is another entrepreneur barely out of graduate school – he’s 28 years old.
But he was actually successful before Spotify even took off. He studied at the Sweden Royal Institute of Technology, dropped out, and worked on creating a new software program for an advertising company. He made millions by the time he was 23.
5. Investors read like a who’s-who list
The number of investors in Spotify reads like a who’s-who of Silicon Valley and the worldwide tech scene. Apart from Sean Parker, the company counts Digital Sky Technologies, Kleiner Perkins Caufield & Byers, along with Wellington Partners, the Hong-Kong based billionaire Li Ka-shing and Northzone Ventures.
The launch of Spotify is exciting as brands are now open to a new and interesting channel where they can leverage on to advertise.
Advertising experts will be in Sydney this November to discuss about the latest trends and development in the advertising space.
