Spotify Still Gaining Steam

It's easy to look at the upcoming streaming music launches from Apple and Google and think that they'll automatically take the lions share of that end of the business, but that underestimates just how important Spotify is the current music industry.

Spotify is now responsible for 10% of the industry's total revenue as of the first quarter of 2015, if you can believe their Director of Economics Will Page. That's a number that few thought would ever be reached, at least from Spotify.

Considering that according to the IFPI, all streaming services combined equaled about 10.2% last year, that means that the company is a juggernaut in the space. Of course, it also means that the 10.2% mark has grown considerably in just 3 months.

Last year subscription music brought in about $1.5 billion, and Spotify accounted for about half that. According to Page, it also accounted for more than 90% of subscription music growth last year.

Granted, these numbers are coming from Spotify, so they're most likely biased, but it does show that the service has a real hold on the market that might be tougher to dislodge than any of the potential upstarts realize, regardless of how deep their pockets might be.

---

Any purchases made through our Amazon links help support this blog at no cost to you (just click here).

How Spotify Helps A Song Become A Hit

The other day Spotify director of economic development Will Page showed some data about how the service can be front and center in helping a song become a hit, using Lorde's "Royals" as an example.

The gist of the example is that playlists are one of the primary reasons that a song takes off on Spotify. When people add a song to a playlist they create, it's almost the same as word-of-mouth in that other people check out the song and potentially add it to their lists as well.

As with so many hits these days, that can help a song get a groundswell, but it takes a celebrity or someone with high visibility to add it to their playlist for the song to explode. In the case of "Royals" it was Spotify's Sean Parker who added it to his Hipster International list which pushed the song to hit status almost overnight.

The interesting thing here is that this is really no different from hit making on radio going back to the 50s. If a DJ started playing a song in a major or secondary city, the song would begin to break out as other DJs would add it to their playlists because it was suddenly got hot.

The fact of the matter is that it still requires some sort of a unexpected break for a song to become a hit, it's just that the break now may come online instead of over the air.

----------------------------------

Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

Follow me on Forbes for some insights on the new music business.

You should follow me on Twitter and Facebook for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.