[Spotify] has struggled to make money due to the harsh economics of music streaming: Spotify and other music streaming companies pay the majority of their sales back to the big music labels to use their songs. It reported an operating loss of €378m in 2017, compared with €349m in 2016.
In a letter to investors, founder Daniel Ek alluded to ambitions beyond simply piping songs into smartphones, citing a vision to become a “cultural platform” where artists can “break free” of the constraints imposed by gatekeepers such as record labels and traditional radio.
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- If Spotify struggle to make money, it must be really difficult for the musicians and bands;
- In his book To Save Everything, Click Here, Evgeny Morozov writes about Amazon’s ‘forays into publishing’:
If Amazon’s dream of a world without gatekeepers becomes reality, then the company itself will become a powerful gatekeeper [… it] might be a reluctant gatekeeper, but it’s a gatekeeper nevertheless (p. 171).
As Daniel Ek espouses the same line as Jeff Bezos, but with ‘record labels and traditional radio’ in place of ‘traditional publishing’, it’s not too outlandish to feel Morozov’s conclusion about Amazon can be applied to Spotify too.