Spotify Looking For Cash In All Kinds Of Places
As effective as free can be when attracting new users, eventually the piper requires payment.
Spotify is apporoaching its own "payment due" moment and has been stepping up efforts to make its popular free music streaming service profitable. Their effort has been focused on three fronts:
- A premium service is getting much more attention from Spotify as it adds additional features beyond just "ad free" to attaract paid users.
- Spotify is rolling out by far its largest
advertising format to date. It will feature wall to wall billboard
ads on its music player that appear after just 5 minutes of inactivity as part of a major 3 Mobile
ad campaign. (Revolution) - To buy more time, the startup is on the hunt for another $40-$50 million in venture capital funding. (paidContent)
Share on:
Surely they will be able to secure more capital funding based on the buzz.
The real question is whether they will ever turn a sizeable profit with advertising revenue alone. I’m not sure they can.
They’ll have to tread very carefully if more changes are required…fans will be wary.
i listen to the free version of spotify at work and i’ve noticed that the ads are getting more and more frequent. one user called in to say she didn’t think it was ‘fair’ that the free service was ad-supported – idiotic. i totally understand that they need to sell ads to support their service . but if they’re trying to persuade me to pay for a premium sub by irritating me with an increasing number of ads, it ain’t working. if i switch to anything it’ll be back to itunes…
Well there are not looking for cash in The Netherlands. Spotify closed the door for premium (paying) users!! Weird.
i just dont think they can survive if they are paying royalties to labels. they are monetizing the wrong area, they should be royalty free with a heavy focus on conversions.