Spotify started out as a legal way to stream popular music. Then he flirted, unsuccessfully, with becoming a video company. Now he’s trying a new identity: he wants normal people, not just the people you’ve heard of, to start downloading songs and podcasts – and then he wants to make money to stream those songs and podcasts. to many more people.
Spotify always wants the biggest stars in the world on its service. That’s why he spends most of his money on licensing deals with major music labels, and why he paid a ton of money to sign podcast king Joe Rogan last summer. And that’s also why he’s working with Barack Obama; the service just announced that Bruce Springsteen and the former president have a new Spotify podcast where they discuss “modern manhood.”
But the main message behind a Spotify promotional event held on Monday, where the company announced a slew of new products and several new podcasts, was aimed at a much larger group of musicians and podcasters who will never be known at the Obama level. , even a little. little famous: Spotify wants everyone to upload their content to Spotify.
Spotify believes it can make money by distributing this content to hundreds of millions of people through a combination of advertising and subscription dollars. In theory, some of this can go back to the people who made things in the first place.
After the event, I spoke with Spotify Content Manager Dawn Ostroff, a magazine and TV industry veteran, Spotify’s overall ambitions and how it is handling the transition from distributor status to content to that of content owner. And, more specifically, how he responds to the challenges of being Joe Rogan’s employer.
Here is an edited transcript of our conversation:
Who is this event for? It seemed to be reminiscent of all the streaming video launch events that companies like Apple, HBO, and Disney have had over the past year or so – sort of geared toward investors, but also consumers.
In fact, we are trying to reach the creators. For us, it was about being able to show where we came from and where we plan to go for the creators.
When you think back to what Daniel [Ek]Spotify’s mission and vision was very early on for Spotify, it was how to connect millions of artists and creators with billions of users. It explained that we have come a long way, that we still have a long way to go and where we are on the journey. And also to be able to communicate to creators the different tools, the different products at our disposal, to help them and accompany them in our journey in terms not only of creation, but of monetization, and of course of reach.
There was a longstanding discussion with Spotify and the creators / artists, in its early days, where artists complained that they were not getting value from Spotify but Spotify was getting value from it. How much has this discussion influenced what you do today – both the way you talk to artists and what you do for them?
Well, we have agreements with the labels. It’s been pretty transparent: people know what we pay, out of our income, to artists and their labels. But I think part of Spotify’s goal is to democratize some form of distribution for artists so they can experience, create, and hopefully grow. Because there is a lot of room for artists who are not necessarily the best artists in the world. And the same with podcasters, there is plenty of room for people interested in having podcasts, who are not the best podcasters in the world.
And the idea that you are able to globalize the platform in such a way that the music crosses all borders and borders, and similarly we see it with podcasts – it really unifies the world.
You don’t have to look any further than the performance of all the major labels. Music catalogs are going for record amounts. There are hundreds of artists who are now making millions of dollars just from Spotify. And that’s part of what we wanted to be able to illustrate today.
One thing that has changed since Spotify started is the way consumers and certainly regulators view the big tech platforms. They generally had favorable feelings towards them, and now there is a lot more suspicion towards them. You have your own complaint about Apple – you say it has too much horsepower. But it seems to me that in audio Spotify has so much power that there will likely be even more suspicion about its motives and what happens when you give Spotify your data or your livelihood.
For starters, compared to Google, Amazon or Apple, we are still very small. We are not in this league. But we’re incredibly focused on the audio. And there should be competition for the tech giants. And that’s who we are. We are competing for them in this area.
Since we’re talking about the giants: For years, Apple didn’t seem interested in making podcasting a business. He seems to have woken up – I’m guessing because of Spotify – and now seems to have plans to invest in podcasting and offer a paid podcast service. What do you think of Apple starting to compete with you in podcasting?
I cannot comment on their plans. And quite frankly, I have no idea what their plans are. But we believe any business that spends money on the audio space is smart. We believe the audio industry continues to grow – we’ve seen an explosion, but we don’t think we will hit a plateau yet.
You’ve spent nearly a billion dollars on startups and podcast content. When Spotify started buying podcast assets, you said you could spend $ 500 million in the first year. Do you think you’re going to keep spending on this clip?
Our goal is to continue to grow. I cannot comment on the exact figure. But we are chasing it because it works.
When Spotify signed Joe Rogan, people like me were wondering what would happen when Joe Rogan offended someone, and it happened. And it turns out that some people work at Spotify.
What kind of discussions have you had about what kind of backfire Rogan was going to generate? And did those discussions understand what would happen if your own employees were upset?
As for Joe: he was subjected to the same policies that everyone else on our platform must adhere to. And for us, it’s about having a diverse voice, for a global audience – a large and diverse group of people who listen to Spotify. And it just so happens that it remains extremely popular.
I can’t comment on our internal discussions, but the debate is also an integral part of Spotify’s internal corporate culture. And it doesn’t just happen with something like Joe Rogan, but it happens in different areas of our business. This is nothing new to us.