4 ms·

This is significant. It shows a do or die attitude and a fact that many companies at this level are not self-aware enough to recognize; that their competition (

This is significant. It shows a do or die attitude and a fact that many companies at this level are not self-aware enough to recognize; that their competition (Apple) will kill them, or, they will dominate this space. Will be interesting to see how this plays out.

acchow 11y ago
What are the "many companies" under real threat by Apple? I think the set is fairly small?
- dandelany 11y ago
  Many companies are under real threat from their competition, Apple is just the example in this case. At least that's how I read it.
- fasteddie 11y ago
  I don't think OP was implying just Apple, anyone competing in a winner-take-all market has to have this attitude.
themartorana 11y ago
It helps that Apple Music has been relatively terrible from the start. I fully expect them to get significantly better, but after Rdio died (RIP, and I got over my mourning) I did the Apple Music trial plus a couple months. Both the wife and I found it incredibly difficult to navigate and understand. Spotify has been much, much better. That said, Apple Music is only going to get better, and fast.
- matwood 11y ago
  It's odd to me how Google Music is not often mentioned. It is either Spotify or Apple Music. I quit Spotify years ago when Google Music started, having never really cared for Spotify.
  - prostoalex 11y ago
    Same here. I switched to Google Music via their $1 intro offer, and so far haven't bothered to look anywhere else. They throw in an ad-free YouTube, so Google's offering is strictly better in that regard.
- mrharrison 11y ago
  My friends, family and I have had a completely opposite reaction. We have all ditched Spotify for Apple music because it integrates with our apple tv, and other devices so well. Beats radio is also pretty good for music discovery, with Deadmau5 and Pharrell having their own DJ spots.
- Negative1 11y ago
  It helps but not as much as you'd think. Lots of great/superior products have failed in the past. Waiting for your competition to fail is a great way to go out of business.
joshjkim 11y ago
Good point - it's all or nothing for Spotify, they are not profitable at current scale and need critical mass re: subscribers + defense against Apple, and if they don't get there, then they are dead anyhow.
- mrep 11y ago
  > they are not profitable at current scale How? They are making approximately a 1 billion dollars a year (30 million subscribers * $10/month * 12 months/year * 30% cut). Their engineers are probably paid less too since they are not based in the US. The only thing i can suspect that they are blowing that much money on is marketing but even that just seems ridiculous unless they are losing that much on the freemium users. Can someone explain this to me?
  - JonFish85 11y ago
    Catalog rights is probably a good portion of it...
  - joshjkim 11y ago
    There's a couple answers here - as you mentioned, marketing is a huge cost, and they have to support a massive global ad sales organization as well to support the free tier. IMO, what's really more problematic and complicated is their economic arrangement with the major labels, which, while ostensibly "70/30" is actually way more complicated than that. The article does a decent job of explaining it: http://www.theverge.com/2015/5/19/8621581/sony-music-spotify-contract http://www.theverge.com/2015/5/19/8621581/sony-music-spotify... TL;DR: to induce a major label to sign, Spotify had to give them a sweetheart deal, including minimum per stream payments, minimum % of ad revenue, and free ad space. The really tricky things to consider are: usage-based and per subscriber minimums. Hard to determine exactly, but it's highly possible that Spotify is much worse off than the 30/70 spotify/label split. Also, note that there's a good chance the contract is already re-negotiated since that was published, and given Apple Music, likely not in Spotify's favor.
    - spiralpolitik 11y ago

acchow 11y ago

What are the "many companies" under real threat by Apple? I think the set is fairly small?

dandelany 11y ago
Many companies are under real threat from their competition, Apple is just the example in this case. At least that's how I read it.
fasteddie 11y ago
I don't think OP was implying just Apple, anyone competing in a winner-take-all market has to have this attitude.

themartorana 11y ago

It helps that Apple Music has been relatively terrible from the start. I fully expect them to get significantly better, but after Rdio died (RIP, and I got over my mourning) I did the Apple Music trial plus a couple months. Both the wife and I found it incredibly difficult to navigate and understand. Spotify has been much, much better. That said, Apple Music is only going to get better, and fast.

matwood 11y ago
It's odd to me how Google Music is not often mentioned. It is either Spotify or Apple Music. I quit Spotify years ago when Google Music started, having never really cared for Spotify.
- prostoalex 11y ago
  Same here. I switched to Google Music via their $1 intro offer, and so far haven't bothered to look anywhere else. They throw in an ad-free YouTube, so Google's offering is strictly better in that regard.
mrharrison 11y ago
My friends, family and I have had a completely opposite reaction. We have all ditched Spotify for Apple music because it integrates with our apple tv, and other devices so well. Beats radio is also pretty good for music discovery, with Deadmau5 and Pharrell having their own DJ spots.
Negative1 11y ago
It helps but not as much as you'd think. Lots of great/superior products have failed in the past. Waiting for your competition to fail is a great way to go out of business.

joshjkim 11y ago

Good point - it's all or nothing for Spotify, they are not profitable at current scale and need critical mass re: subscribers + defense against Apple, and if they don't get there, then they are dead anyhow.

mrep 11y ago
> they are not profitable at current scale How? They are making approximately a 1 billion dollars a year (30 million subscribers * $10/month * 12 months/year * 30% cut). Their engineers are probably paid less too since they are not based in the US. The only thing i can suspect that they are blowing that much money on is marketing but even that just seems ridiculous unless they are losing that much on the freemium users. Can someone explain this to me?
- JonFish85 11y ago
  Catalog rights is probably a good portion of it...
- joshjkim 11y ago
  There's a couple answers here - as you mentioned, marketing is a huge cost, and they have to support a massive global ad sales organization as well to support the free tier. IMO, what's really more problematic and complicated is their economic arrangement with the major labels, which, while ostensibly "70/30" is actually way more complicated than that. The article does a decent job of explaining it: http://www.theverge.com/2015/5/19/8621581/sony-music-spotify-contract http://www.theverge.com/2015/5/19/8621581/sony-music-spotify... TL;DR: to induce a major label to sign, Spotify had to give them a sweetheart deal, including minimum per stream payments, minimum % of ad revenue, and free ad space. The really tricky things to consider are: usage-based and per subscriber minimums. Hard to determine exactly, but it's highly possible that Spotify is much worse off than the 30/70 spotify/label split. Also, note that there's a good chance the contract is already re-negotiated since that was published, and given Apple Music, likely not in Spotify's favor.
  - spiralpolitik 11y ago