With 2.5 Million Paying Subscribers – What Will Spotify Do Next?

SpotifySpotify, the media darling music streaming service, has announced that they now have 2.5 million paying subscribers – a large chunk of the on-demand streaming market. Whilst many had tried and failed to make headway in the streaming business, Spotify has gone from strength to strength with a very noticeable bump in subscribers after its US launch and with the recent Facebook integration.

The paid subscription allows users unlimited plays of any song (the free version only allows you to stream a song five times), but more importantly lets you sync playlists with your internet enabled device to use when you do not have an internet connection. Oddly for a streaming service – it is this offline syncing that has proved popular with paid users – as to a great extent it gives any user access to all Spotify’s library of millions of songs without either buying them as singles or albums, or even filling up all their hard disk space.

This announcement also proved as a teaser for the company’s conference next Wednesday in New York where CEO and founder Daniel Ek will “unveil the latest major development from Spotify – and a new direction for the company”. The rumours and expectations as to what this new direction will be have come in thick and fast from across the interweb, but we have a few ideas of our own.

A better Spotify API

Spotify’s API is currently rather limited at best and specifically bans developers from offering paid apps on top of it – somewhat of a dealbreaker to many. The announcement could be a restructuring and opening of the API to developers – both large and one-man teams – so that Spotify can become the music backbone of the web. The Facebook integration has enabled Spotify to be permanently seen in the “ticker”, constantly advertising the service and giving people inspiration as to what to listen to – but to extend the API so that there were numerous apps and web services making use of music in every realm of the web and all relying on Spotify could give the company a lot of power in the digital space.

A Spotify Music Store in the US

Spotify brought its European music store in-house earlier this year to allow subscribers to purchase the playlists they make on the service as freely downloadable MP3s – 10 tracks for £7.99, 15 tracks for £9.99, 40 tracks for £25, and a 100-track playlist for £50 – but this service is currently not available in the US. It is a great way to monetise their sizeable free userbase and could help them steal marketshare from digital music store like iTunes and Amazon who currently still dominate the digital music download space.

Start Streaming TV and Movies

Spotify has the infrastructure and technology to stream 320kbps digital audio to millions of subscribers on-demand, so technologically it is not a huge leap to start streaming tv shows and films. If they could offline sync this video content as they do music then that could be a huge advantage over Netflix and Hulu – the current leaders in the space by a good margin. People want to watch these videos on their tablets and smartphones, but with limited data subscriptions and lack of a connection in many places such as on the tube – offline syncing would be a real boon. The biggest hurdle for video streaming would be the licensing, but Spotify have proved themselves rather adept at such difficult licensing before with the music industry so I wouldn’t put it past them. They have a name that is not vertical-specific, and TV networks are trying to loosen Hulu and Netflix’s hold over the market – so don’t rule them out!

We’ll update you next week when we find out more.

Share This