Spotify is one of the most popular music services available. With free registration, Spotify allows its users to stream thousands of songs from the app, with music ranging from The Rolling Stones to Kanye West. Spotify also offers a paid service for its users that allows them to stream and save songs for offline play on their mobile devices, essentially eliminating the need to download songs (either illegally or legally).
Spotify has turned into a multi-billion-dollar business, after a $100 million investment from Coca-Cola and Goldman Sachs valued the private company at $3 billion. But Spotify wants to expand into video and, according to a Business Insider source, is planning to prep a streaming video service. What do we know about Spotify’s secretive video service? Here are five fast facts we’ve compiled for you.
Remember: We’ll be updating this post when we hear anything new, so stay tuned!
1. Spotify’s Streaming Video Service Will Compete Against Netflix…
Obviously, when it come to streaming media, Netflix is king. The company has not only revolutionized how we watch TV and movies on our mobile devices and personal computers, with shows like House of Cards and Arrested Development, the company is also producing high-quality content as well. Spotify and Netflix have very similar trajectories. Initially, both company’s planned to build up such a user base that they could be able to control negotiations with the music labels (for Spotify) and content providers (for Netflix). However, that wasn’t didn’t happen for either company. Netflix fixed that by creating their own original content. Spotify’s plan is to pull an Amazon and create a competing video service (Amazon did the same with Amazon Instant). We’ll see if Spotify can compete with the streaming video giant.
2. And HBO Too, Apparently
Speaking of going after some big names, Spotify also plans on taking on HBO as well. Netflix CEO Reed Hastings has already said Netflix is planning on competing with HBO in terms of high-quality, thought-provoking, and high-brow content like The Sopranos, Game of Thrones, and Girls. Netflix is on the way, with the critically-acclaimed hit House of Cards and the upcoming season of Arrested Development as well. It seems like Spotify will be unveiling some original content in the future as well, but will be aiming to compete with HBO instead of the original content from Netflix.
3. The Streaming Video Market Is Already Over-Saturated
Not only is there Netflix and Amazon Instant Video, but there are also a plethora of other streaming video services. There’s Hulu, that shows your favorite TV shows a day later. There’s the new Redbox Instant by Verizon, which costs only $8 a month but doesn’t really offer that many features. There’s the innovative HitBliss, which allows users to watch some commercials to earn credits to watch TV shows and new movies commercial-free. As you can see, there are already a ton of competition in the streaming video marketplace. When you throw in cable, its over-saturated. Yes, eventually, cable will be rendered obsolete (in like 20 years, though), but most likely, services like Netflix, HBO (who is reportedly prepping a new “add-on” service), and Hulu can replace cable in the coming years.
4. Creating Good Original Content Is Easier Said Than Done
Spotify may hope to produce some solid original content, but its more difficult than it sounds. Even Netflix had trouble initially. House of Cards wasn’t the shows first foray into the original content market. Lillyhammer, a show starring Sopranos cast memeber Steven Van Zandt, came out in February 2012 and wasn’t as critically lauded or as popular as House of Cards. Yes, Lillyhammer lacked the big names that House of Cards had, like Kevin Spacey and David Fincher, but it shows that not all original productions, even with a relatively big name attached, will do well. Of course, it’s different with a show like Arrested Development, which has a built in base, considering Netflix bought the rights to the program from Fox.
5. Spotify Needs to Come Up With Other Sources of Revenue
The reason Spotify has allegedly decided to come up with a streaming video service is because more and more companies are planning on venturing into the streaming-music service. Amazon, Google, and Apple have all reportedly been working on their own streaming music service. Considering those big names, Spotify is is good company, but with the user base those companies already have, Spotify could be left out of the market. Obviously, it depends on what kind of features and add-ons Amazon, Google, and Apple introduce, but these companies have been known to be very innovative, so we could see some amazing new features in a streaming music service from one of the “big three.”