Spotify’s share price – which has been slowly declining for a month now – took another dip early yesterday as the streaming business published its third quarterly report since becoming a publicly listed company.
This was despite the firm reporting perfectly decent premium subscriber growth- it now has 87 million paying users worldwide – and lower than expected operating losses. However, Spotify HQ did also reduce its anticipated year end premium subscriber figure and admitted that losses were mainly down due to delays in hiring new talent and, as a result, less being spent on research and development to further evolve the company’s product.
Spotify’s overall userbase, when you include everyone on its free tier, is now up to 191 million, though premium subscribers continue to bring in the vast majority of the cash. Total revenues for the last quarter were up both year-on-year and quarter-on-quarter to $1.54 billion. Though – of course – it remains a loss-making business overall. Total operating losses for the third quarter were $6.8 million.
Away from the stats and the figures, Spotify’s quarterly report also bigged up the direct-upload tool it is developing for DIY artists, so that they can directly pump their music into the system without a distributor, and the company’s ongoing dabblings in creating original podcast and spoken word content.
Both of those developments seek to reduce, to an extent, Spotify’s dependence on the record labels. And said initiatives were presumably name-checked because of concerns among some investors that that ongoing dependency on the record companies, and especially the three majors, could hinder the digital firm’s long-term bid for profitability.
Although, at the same time, other investors fear that the direct-upload tool and Spotify’s move to do direct licensing deals with established artists in control of their recordings will damage its relationship with the majors just as the next round of licensing deal negotiations begin. With that in mind, boss man Daniel Ek again insisted yesterday that “we don’t view our strategy to be in opposition to any of our partners”.[from https://ift.tt/2lvivLP]