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Even With Double the Subscribers, Spotify Says Apple Will Always Have an Edge Owning the App Store (techcrunch.com)
On Wednesday, Spotify filed for a direct listing in the U.S., sidestepping the traditional IPO process, and now we're starting to see some of the true financial guts of the company -- and some of the significant risks it faces from challenging services from Apple and Google. From a report: Apple, for example, charges apps a percentage of revenue for subscriptions processed through the App Store. Apple Music, meanwhile, will always deliver Apple 100 percent of the subscription revenue that it receives from subscribers (sans record fees and all that kind of stuff, of course). Apple, too, has a direct integration with its iOS devices and also a huge amount of brand recognition, even though Spotify is a massive service. Spotify says it has 159 million monthly active users and 71 million premium subscribers, while Apple has 36 million paying subscribers as of February 2018. Spotify said, "In addition, Apple and Google also own application store platforms and are charging in-application purchase fees, which are not being levied on their own applications, thus creating a competitive advantage for themselves against us. As the market for on-demand music on the internet and mobile and connected devices increases, new competitors, business models, and solutions are likely to emerge."
that Apple doesn't give away their razors, and people are willing to pay a premium for the ability to pay for Apple App store goods...
The advantage that Spotify has over Apple, is that they are much much much more agile. If you look at the iTunes app on both iOS and MacOS X, it takes Apple several updates to fix even minor issues, let alone major annoyances (for instance the fact that album artwork is gone in listview for most of the albums)
this is where Spotify can run circles around apple : listen to your subscribers and improve your product swiftly ! Keep an eye on the complaints about the Apple Music Store and make sure you have the better service !
This is the reason I have a spotify account and not an apple account even though our family has at least 10 apple products in the house (iPads, iPhones, Macs)
I do fear however that the IPO of spotify will put them in the same ballpark as apple : sluggish and only focused on shareholder value, not customer satisfaction
Spotify said, "In addition, Apple and Google also own application store platforms and are charging in-application purchase fees, which are not being levied on their own applications, thus creating a competitive advantage for themselves against us..."
Sounds like lining up an excuse for investors.
Sheez. Louize. Being a baby much?
The Idles Of March Are Up On You!!!
As the summary makes clear, Spotify is calling out both Google and Apple in their whining about having to pay for those services.
As editor msmash puts in the title, only Apple is to blame. Once again a slashdot editor who can't be unbiased because 90% of you will only read the title. She is the Matt Drudge of this place now.
... discovers competing with a monopolist is tough. News at 11.
Spotify has been around for 12 years pretending to be a tech company but is in the end a poorly performing startup that has only managed to create a Streaming-app. Being the first to do so obviously gives you a healthy start but competition will catch up, especially when it comes from companies that already capture the same audiences and have all the economy of scale to run considerably cheaper platforms. Instead of moaning about competition, Spotify should (and should have done so years ago) find other sources of revenue and expand their product portfolio to being more than just a streaming App that has more users that don't pay them than do.
Why don't the MtV made a musiscervice? This would win!
Wiat? Whazat? MtV don't have the musoic? Mevernind.
The article says that Apple "charges apps a percentage of revenue for subscriptions processed through the App Store". But what forces them to process the subscription through the app store???
Take Netflix as a good example - you don't subscribe on the app store. The app is completely free. You subscribe once using a credit card for payment, and then fill the account information on any number of devices your family has (tv boxes, phones, tablets, etc.). These devices do not even have to have - and often do not have - the same Google or Apple account on them.
*That's* the way of the future, not going the subscription through Apple, letting Apple take 30% of the money and at the same time, not accepting that families own several devices and expect to be able to share the subscription on all of them.
It's probably an issue of being the primary platform. Mobile may be the primary platform for Spotify, unlike Netflix, which is more likely to be used on a TV. Apple doesn't allow apps to add a link or even show information about purchasing a subscription without paying Apple the 30% tax, so somebody who wants to use Spotify primarily in her phone will probably download the app, find no way to purchase it, and become a lost sale.
Kindle was in a similar situation, Apple introduced their own competing app, iBooks (which has no obligation to pay anybody 30% of each sale, of course) and suddenly blocked Amazon from allowing people to purchase a Kindle subscription through their app, something which was previously possible.
Those predatory practices should be regulated. If you (as a company) offer an app market for third parties, you shouldn't be able to add your own competing apps to the same store. And it's not only about price! Apple's own apps are always prominently featured in the store, while any competing third party apps are usually hidden, for example.
Impulsivity. You're listening to Spotify and they play an ad that drives you over the edge, so you consider getting their paid service. Well, if you're in the app to do it, Apple will get their cut. Otherwise spotify will ahve to make you visit their website, log in, enter all your payment information and then buy the subscription.
Whereas using Apple Pay or Google Pay, it's a couple of taps and you're subscribed.
So the general user experience is you can capture the impulse shopper if you're willing to give up a part of the money or force the user to go through hoops and by the time they're done, they cancel because it was just taking too long.
The real question is - is the added hassle and abandoned purchases using the roundabout way get you more than if you gave in and simply let people impulse buy.
Great point. And not mention that Spotify has a free tier which many listeners are totally happy with that level of service. If they want to compete with Apple and Google they need to eliminate the free service option.
They can use some 3dparty sites for this purpose like https://narrativeessays.org/. It would be interesting to investigate.