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Spotify Now Has 15M Paying Users, 60M Overall (techcrunch.com)
58 points by corneliusjac on Jan 12, 2015 | hide | past | favorite | 66 comments



I had the unfortunate experience of signing up for Spotify, creating a playlist of a couple of my favorite artists and then having those artists' songs disappear the next day. Come to find out, they (or their label) didn't renew with Spotify. Went back to purchasing individual tracks that can't be deleted from my devices.

I do like the Spotify model, but find between iTunes, Pandora and Sirius my music needs are saturated.


I recently ditched the Zune "all you can eat" subscription for a Spotify subscription.

Pretty much the same deal. Stuff comes and goes, and there's no warning to the user (I imagine that a warning that content is going to go away would increase piracy).

This is why I still buy CDs.


Most likely this huge growth over the last couple months has been the $0.99 for three months offer - http://www.cnet.com/news/get-a-3-month-spotify-premium-subsc...

It's a great way to inflate subscriber numbers for an IPO, but I doubt it's a long-term trend.


I decided around two years ago to abandon "owning" most of my music. I started with Rhapsody and moved to Spotify. I find that Spotify has almost everything I want to listen to and the $10 / month (actually, $20 since I have two more accounts on the Family plan), is well worth it.

For people who like to listen to a wide variety of music and like to discover new music, I don't think you can beat what Spotify offers. If you have a more tightly contained bucket of music and don't want to expand in too much, it probably makes more sense to own your collection.

I've discovered a ton of stuff and enjoyed things one-off like live CD's that I would have never have purchased outright through iTunes.

I ultimately chose Spotify over Rhapsody because of playlists. I think when I first started, I actually prefered Rhapsody's mobile UI but Spotify's has gotten better since. I remember using Rhapsody's web/desktop service in the mid 2000's, but it wasn't an iPod replacement then because it's offline capabilities were limited and limited to devices that I didn't like. Once mobile became realistic to stream music, the services started making a lot more sense to me.


> For people who like to listen to a wide variety of music and like to discover new music, I don't think you can beat what Spotify offers.

Eh... Sort of. If I want to listen to something within (making it up) the top 50% most successful recording artists, or something relatively recent otherwise, it's normally got something at least.

If I want to listen to underground hardcore records or weirdy free improv or something, I'm S.O.L. on streaming services.

Still, I pay my £10 a month, because it's good for a lot of things, and convenient.


I disagree. It is actually a very rare for me to not find a band on Spotify, and my listening is mostly focused on esoteric or small bands in a variety of niche genres.


There is an old radio show, Bob & Ray... they once were nominated for a Grammy.

Rhapsody has many (though not all) of the collected volumes, dozens I'd say. Spotify has one 1970s album of theirs.

Also noticed a standup comedian on Rhapsody, Ralph Harris... his album Hickey Head is there. Nothing on Spotify except a single track on someone else's album.

I find about one or so artist per week that's not on Spotify.


What are you disagreeing with? You both have different music preferences.


there are tons of good bands that are not on Spotify, even modern (florida noise punk scene is really easy example)


Yeah: I listen to a lot of very obscure 90s emo records, which were all fly-by-night bands on tiny vinyl-only labels (and other similar corners of the music industry). This stuff is not on Spotify. I did not expect it to be on Spotify, and thus was not disappointed.

For contemporary stuff of that level of nicheness, Bandcamp is a much better source. And selling one $5 download/print-on-demand CD is probably more lucrative than all the Spotify streams most bandcamp bands could ever hope to get put together, so it's hardly surprising that they go this way. Spotify seems a more sensible partnership for labels with significant back catalogue than individual artists. (Which makes it peculiar that I can't browse by label, but there you go.)

I like Spotify for classical music and jazz, but my tastes are more 'mainstream' in those categories. It also has a surprisingly good collection of house/techno/etc singles, but I kind of need the files for those for DJing purposes and such.


You can use "label:xyz" in the search field.


Well... the more you know.


Spotify's coverage is very good but they have been catching holes in their catalogue lately. Taylor Swift's absence probably won't bother HN users too much but lack of the latest Black Keys' album might.

Spotify more than makes up for it with curated playlists and apps (pitchfork, Last.fm, Hype Machine) making music discovery easy and pleasant. But if someone wants to listen to particular songs, like they would from their own collection, their mileage may vary.


I'm a paying user. My fiance pays as well. It's a great service, but I wish they would come out with a "family plan" or something. Often we are both listening at the same time to a single account which negates the utility of having two separate accounts quite a bit. However, at work we both listen to our separate accounts and listening to the same account would not be feasible. Netflix allows for multiple queues for different users, I think Spotify should follow suit.


If you're in the US, they have this already:

https://www.spotify.com/us/family/

It launched a few months ago.


Thanks for this! - UK version here https://www.spotify.com/uk/family/


Thank you very much. I am happy for once to be mistaken :)



Thank you for mentioning this.


This also works in The Netherlands.


I enter "offline mode" and listen to songs that have been downloaded only. This allows the other device sharing your account to take over and play async without affecting you.


Despite Spotify occasionally being in the news for not paying the artists much, I bet this does add a lot of new revenue for the music industry.

Before I joined spotify (about a year ago) I hardly ever bought CDs or MP3s (defintely less than the £120/year that Sptofy costs) - there must be many other people also who are paying for Spotify now who never used to spend much on music before


One data point: I haven't bought a CD since the 90's but I now have a paid Spotify account.


Same. Spotify is just too damn convenient not to pay for it.

Not having to copy over my playlists to my phone, but just being able to sync, that feature alone is worth the €10 subscription to me.

I discover a song, add it to a playlist from my mac, and I can listen to it next time I leave the house.


Spotify is really sort of a separate internet for music. Anywhere you are, if you hear about a new genre, you can immerse yourself in it within seconds. Imagine doing that back in the days of Tower Records? Even the Tokyo location, or Amoeba Music can't cover the territory like Spotify can. I've tried.


And that's why I love their product. I haven't seen any streaming service do it that well.


> I bet this does add a lot of new revenue for the music industry.

Not that much.The music industry is over. Call it the entertainment industry , where the popularity of a song is mesured by youtube views,not actual sells. Even iTunes don't pay that much now a days. It's good, because any artist can "grow up fast" with a good social network marketing strategy. It's bad, because some kind of music need some investment only big producers could afford before. But crowdfunding can fix that. Yet no one can deny that the amount of crappy music today is just overwhelming (looking at you "hiphop"). Something like Nirvana could never happen today.But bands like Nirvana could have a moderate success.

But if you ask me, as an artist,while it's tough,i'm ok with how things work today,since I actually do some gigs and that's the most interesting part.


My biggest issue with Spotify is still their catalogue. I listen to primarily foreign electronica, and it constantly feels like none of it was there. When I finally did want to grab music from American artists, half weren't on Spotify.

Something I've wondered for some time, is if the world needs a music service that both allows smaller artists to stream their music from it, but also negotiates with companies like iTunes/Spotify/AmazonInstant to allow their music there as well.


Some sort of deal to get SoundCloud and Bandcamp artists' content available on Spotify would be great.


This! I think Spotify/Rdio/Deezer/etc should make a deal to license music on Soundcloud. The best indie music, mashups and mixes are on SoundCloud.


The "incrementally even more convenient than piracy" for Spotify (and also iTunes Rentals on Apple TV) has really surprised me.

I used to use oink/what.cd to download all my music, but now that I use Spotify I never stray from it. A friend emailed me J.Coles newest album in MP3 but I opted to just wait until it was on Spotify for the sake of simplicity and accessibility.

Similarly with movies, whereas I would once always simply torrent them, sitting in front of my TV and just renting them for $4 feels so much cheaper than battling an advertising laced torrent site and figuring out how to stream it from laptop to TV.

Pirating stuff was much easier than buying CDs or DVDs, but purchasing stuff online has became even easier than piracy.


When I was in high school (quite a long time ago now), I'd try to buy 2-4 albums a month. That was an average cost of $25-$50 to listen to 20-50 new songs... some of which I enjoyed, some of which I didn't.

$10 per month to listen to almost anything is such an astounding underpricing of the value I personally derive from the service. I can hardly believe my good fortune to be alive at a time when I can pay so little to listen to so much with so little effort.


And this is exactly why the music industry is failing.

Even if every American paid $100 per year, that maxes the revenue at $30 billion with no further growth possible.

Now how much of that it going back to the music creators? Almost zero.

If I take your high school numbers and extrapolate ($250/year across 300 million) with a $.50 per CD (20 albums per year) we get a $75 billion business with $3 billion actually going back to artists. For 20,000 CD's (roughly the number of releases last year) that's 150,000 per year back to the CD creators.

That's an ENORMOUS difference.

Yes, these are all bounds (not everybody would buy--there were fewer CD's in the past--CD's were more expensive to produce), but you can see the difference.

Now, this isn't all Spotify's fault, but the middlemen are taking WAY too much out of the pie.

In addition, there are so many entertainment options that music has to compete with that it will never get back the privileged position it had in the late 60's to early 80's before both VHS and videogames.


this is my whole point I've been ranting about -- Spotify absolves peoples' guilt but they are just feeding the middleman, who seems to be taking the WHOLE pie.

i think pure torrents + physical sales would actually result in better money for artists than the same situation + Spotify.


Shameless plug: I'm a paying Spotify user but they don't get hiphop mixtapes and they miss some hiphop singles, so I built http://hooked.fm. It's new hiphop music and notifications when your favorite artists release new music.


if the money never gets to the artists what is the point? its good to build up an infrastructure but this is more to keep the industry's pockets lined than the artists, so i've seen at least a few who encourage to just torrent their work instead.

there are some who argue that the pricing model is not really incorrect/askew, but i think even they tend to admit that its insignificant income from the perspective of the artist.

(as someone who is not into pop music, i really don't care about building a whole economic/industrial mechanism just to make sure that beyonce & WMG keep getting a disproportionately large piece of the pie compared to independents, that is not really in the spirit of the internet IMHO it is just a web-based continuation of the old system that smaller artists hated...)


It's so hard to put a value on something like Spotify. I use the Spotify Pitchfork app pretty much every day to find new music. Before that I'd have to read Pitfork.com and then either torrent or buy that artists music. This forced me to be super selective in who I gave the time of day (because reading + downloading would take hours). With Spotify I can listen to 4 whole albums in one day.

If I find an artist I like I will definitely go to one of their live shows. I feel like I spend more on an artists now than I did when I bought their album outright.


hah great for Pitchfork... i'm sure they are making much more than the artists off this deal.

regardless, they don't cover the bands i like and half the music i like isnt on spotify so i just do it the old-fashioned way using discogs.com, downloads, and some good sites that have "related artist" webs. wouldn't you know it, the best site i know for related artist webs isn't a major industry service, its a torrent site! & they accomplish it trivially through user-edits...

so i guess my point is i think its true that Spotify can be convenient for some people, but it doesnt refute my point that they are not trying to do anyone favors (unless it fits their current branding strategy). Spotify is not some techno-anarchistic's grand vision of the music industry. it's not helping music fans discover more about their tastes, it is generally colluding with industry to guide listeners toward their profit sectors. I wouldn't be at all surprised if there is a complex sequence of kickbacks between labels, Spotify, and the venues themselves, designed to minimize artist royalty/payouts. If you follow the music industry you know the deals for artists are generally pretty bad & I don't really believe in the "but I go see them live!" rationale because some artists don't tour or aren't big arena acts. AFAIK it's really hard to recoup tour costs unless you are playing decent-sized venues at every stop.

i guess it is just hard for me to get into the feelgood mentality of the music scene when i feel like the technology available could allow us to be much more taste/trend/industry-agnostic but instead seems to just be an extension of industry power (Pitchfork being a major industry player as well...), and I generally feel like the quality of the artistic output is in decline so I don't want to buy into most of the over-produced crypto-pop junk they are selling (fans of 60s/70s/even 80s music are accustomed to a much greater wealth of musical diversity). As I mentioned though, I am not into music journalism i just use artist webs. Maybe if there were some tastemaker I really wanted to follow I would see this as more convenient but I just don't experience music that way. Or at most I'd be like "well, convenient for me, sucks for the artist".

I think I mentioned in my previous comment -- it's not that I can even prove the pricing model false, I just know it doesn't do shit for the artists... 1 sale of a self-published physical album is more profitable for most of them then a year's worth of Spotify listens.

i bet a solely torrents + physical sales model would actually be MORE profitable than involving Spotify... Spotify to me is really only a mechanism for absolving people from the guilt of theft, and conveniently it funnels money back to yet another corp.


There's gotta be some way to make a pay-only streaming service that would fairly compensate artists...

What if, instead of being paid per play, artists were compensated based on the number of unique visitors that played their music? So if one person plays one of their songs, they get paid (for instance) a whole dollar. If one person plays that song 5000 more times, the artist still only gets paid one dollar. But if 5000 different people play that song, the artist gets 5000 dollars. Once. I think this scheme would compensate artists much more fairly, like iTunes, while also providing the cloud hosting and flat monthly fee that attracts users.


How do you get one dollar per song and user, though? The users would have to pay for that. Since they probably listen to a lot of songs in a single month, it would become rather expensive.


Would they, though? I listen to a lot of different music, but I also create playlists that I listen to most of the time. As an example let's take the average user that listens primarily to the top 40 hits and a few select albums from those artists. In one month how many new songs would they listen to on average? 10? 15? Framed this way, a dollar does seem too high, but not by much. I think $0.40-$0.50 per song would be profitable, but that's just a guess.


To me spending 10$/month seems about right - in former times I would probably have bought one CD per month on average.

However, I think what might confuse people in terms of perceived fairness is that with a flatrate, people might listen to a lot more music. But it is a tradeoff between people listening more but paying less per song and people listening less and paying more per song. It's a mistake to think "whoa, if I had sold as many CDs as people listened to my songs on Spotify, I should have received x million $$$." The reality is people probably wouldn't have listened as much without the flatrate.

So in the end all that matters is how much money you receive, not how many times people listen to your songs.

And what have you gained if you limit people to 10 songs per months vs thousands, if they spend the same amount of money? It is only an inconvenience for the audience.


Have any independent artists with a significant amount of listens posted how much money they are making? I am sure there are some rules against this...

I know for signed artists it is a really small amount.

It seems like most groups have accepted that they will make most of their money from shows and merchandising. At least that is the feeling I get.


RJD2 commented a few years ago on his reddit AMA about his royalties:

"i got a check from spotify last month. $.22 was the amount. that help?"

http://www.reddit.com/r/IAmA/comments/y542u/hi_im_rjd2_produ...


RJD2 only has about 100K followers on Spotify. For comparison, that is about the same amount as two of my favorite bands, Opeth and Nick Cave & The Bad Seeds.

It's not Spotify's fault that RJD2 is only as popular as obscure Swedish death metal or obscure 80's folk goth music.


I don't know RJD2, but does Opeth and Nick Cave really only make $.22 a month from Spotify?

If that's true, something is deeply and terribly wrong with the license agreements. These are not some amateurs, but pretty big acts with fans from all over, and while I despise saying they "deserve" this or that I would at least expect the sum to matter.


Yeah, Opeth has 735,477 listeners on last.fm - that's comparable with the best known artists in the genre ever like Deep Purple or Black Sabbath (around 2 million both).


I've been using last.fm for a long time and I've spent a lot of time looking at the data. I would argue that the average person on last.fm is much, much more likely to have heard of Opeth than the average YouTube or Spotify user. I'd also argue that straight up listener count isn't a very useful number, since Kanye West (the most listened to artist on last.fm last week by about 33%) only has about 4M listeners. I don't think Kanye is only 5x as popular/successful/listened to as Opeth.


Sure, but look at it this way. If an artist who has 100K followers removes their music from music sharing services and decides to sell MP3 versions of their album directly for $2. That is 200K. 22 cents a month is obscene.


RJD2's most popular song has more than 17 million streams. Opeths has 500k, the other band you mentioned has a number of songs around 2 million streams. Spotify pays artists based on number of streams, not based on how many followers they have accrued.[1]

So RJD2 should be making significantly more than the bands you mentioned given that his number of streams should represent a larger portion of spotify's total streams.

[1]http://www.spotifyartists.com/spotify-explained/#royalties-i...


RJD2's first two albums were done on two different record labels. His more recent two albums were done on his own record label. His songs with a lot of plays were on his first two albums. It's probably his old labels that are making all the money here.


I have a Youtube video with 17k views that earned me $22.

So assuming one follow ~= one view per month, that means Youtube is 600x more profitable than Spotify. Interesting since Youtube is free and Spotify has paid stuff.


You owned the video. Who owns his song? Spotify could be exactly as profitable as YouTube if he only owns one-sixhundredth of the song.


But still, $.22 for 100k followers is not very much.


Do remember it's also based off plays, not follows. I could have 100k followers, but if I get 500 plays a day, I'd get barely anything.


Ha i kindof just want to repeat exactly this: "But still, $.22 for 100k followers is not very much."

I understand there are technicalities but 22 cents/month is what you'd expect your complete unknown "electronica in basement" neighbor to make off a major distribution outlet, not known artists, even if they are obscure (which I think is a ludicrously out-of-scale term considering these bands have international followings).

I'm sure someone in this equation is making money, thats why it rubs me the wrong way.... it is an extension of the industry rather than a correction of it.


Did he have 100k followers 2 years ago when he posted that or does he have it now?


Surely they'll figure it out somehow, otherwise why would artists continue to give them their music?

Please no sob story about innocent artists being exploited by their publishers. Same logic applies - why would artists continue to work with such publishers?


They just had a buy 1, get 2 months free promotion during December. I wonder if that 15M paying users will be more or less come end of March.


I think premium is too expensive for my needs. So I found a way to use trials from time to time. Basically create a new paypal account every time you want sign up for a new Spotify 30 days trial...


Or pay the $10/£10 the times you need it and cancel the subscription straight away. Seems like an awful lot of work to setup PayPal accounts to avoid paying $10. I understand that can be a significant amount of money for some people but why is it so important to have Spotify from time-to-time that you would go through that process?


That is an outstanding conversion rate. I wonder how it compares to its competitors.


I assume that means they also make a healthy profit? Oh, nevermind.


How does Spotify count users? They can game the proportion of paying/non-paying users by discounting infrequent unpaid users, for example. A more interesting number might be the number of /plays/ by paid vs. unpaid users. I.e., normalize it for activity.


Say they do? that's still 15M people paying 10$~ per month. 150M a month is a revenue of 1.8 bln dollars per year that's quite a big sum of cash...

At some point people stop looking at the paying to non-paying ratio of your costumers and when you starting bringing close to 2bln a year you are probably there.

No one really looks at how many "free apps" people download from the app stores and says Apple are padding their numbers when the app stores brings higher revenues than the GDP of many countries.


It's important because as it says in the article, artists (Taylor Swift, e.g.) care about how much people get for free. So the ratio of paid to unpaid is pretty much the heart of this news.




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