Music streaming service Spotify is a project created by Swedish entrepreneurs Daniel Ek and Martin Lorentson. The domain name of Spotify.com was registered in April 2006. The service started its operation on the European market in 2008 and in the United States in 2010. In 2013 a mobile application was developed. In Kazakhstan, it was available through a VPN only.
This summer Spotify has decided to extend its influence for the East Europe market by connecting with 14 new countries including Kazakhstan. According to Gustav Gyllenhammar, vice president of Spotify on new markets, the estimated number of music fans in the new territories is about 250 million.
In response to Kursiv's request, Spotify’s press service said that the total number of clients is about 285 million people as of March 2020. Roughly 130 million of them use Spotify Premium tariff. (In Kazakhstan it costs $4.99 per person, $6.49 for two users or $7.99 for the whole family of six users.) According to Spotify data, its mobile application holds the first place in the chart of free music applications.
In contrast to competitors, Spotify is focused on music only and does not develop other businesses. “Spotify registers almost five billion digital interactions a day. We see which songs users like, what tracks they switch from, and what artists they look for. Therefore, we can make very effective suggestions based on users’ preferences in music,” the company’s representatives say.
Spotify is also trying to help artists and uses its“Spotify for Artists” service to offer suggestions. It provides artists with all analytics on streams in real-time. As the company’s press service noted, any artist from the countries where Spotify works officially can suggest his or her music to be added to the global Spotify playlists.
Currently, Spotify is offering users about 50 million tracks, personalized recommendations, and four billion playlists. If we put all streaming services in one chart just to compare their characteristics you would find no obvious advantages of Spotify. For instance, Deezer has a better sound, Sound Cloud has more tracks, Apple Music shows lyrics and Yandex.Music allows uploading your own songs, not to mention the same cost of the subscription. Why is Spotify so attractive?
Guess the melody
An international group of programmers attempted to answer this question in 2018. They found that Spotify does the best in quality analysis of digital data. Another project that can do the same is Shazam, a service that can guess the name of a playing song and its artist as well.
In other words, both services use algorithms that can learn all prior users’ requests, preferences and create a personalized list of music. Spotify is the best in terms of preferences of one certain user, but when it comes to a big audience, Shazam is much more effective.
For example, Spotify recommendations are not just suggestions for new hits which user would probably want to listen. The service can analyze similar requests from its audience for many years to create non-standard playlists.
By processing tens of millions of requests on a daily basis, Shazam can even use this information to guess the name of a winner of some music contests, something it has done several times. Thus, the data that Shazam has been collecting for years helps artists feel confident in their new hits even before release.
Streams provide more than half of the revenue of Spotify at $11.4 billion out of $19.9 billion in total. Also, consumers are twice as likely to buy digital over hard copies. Streaming services helped the music industry to cope with troubles caused by intellectual piracy.
It’s common practice to pay for a subscription, and thanks to Spotify, Kazakhstani customers now have a better choice of services they are ready to pay $5 a month for. The total number of subscribers of all music streaming services over the world is 394 million, according to Counterpoint Technology Market Research.
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