Class Essay

SPOTIFY

RATCHAPON CHANTARALAWAN

11701608D

LTL002

SPOTIFY- DIGITAL MUSIC SERVICE PROVIDER

SPOTIFY - Background

Spotify came from the word Spot and Identify. It first created by the idea of spotting and identifying your music favorite that you have already forgotten or not even realized that you had known it. The main purpose is to collect all the music around the world and make it accessible to everyone through their platform. Spotify provides a music service that allow its subscribers ability to legally browse music or video music on-demand when internet data is available. There are both free and paid (premium) subscribers version. Their mission is not only to bring users closer to music and artists but also to fight against piracy by providing users far greater experiences and help out artists to receive more income out of their hard work.

The company was established by Daniel Ek (founder of Advertigo and Evertogo) and Martin Lorentzon (Co-founders of Tradedoubler). The website was developed by Spotify AB team in 2006. Soon after, in 2008, its first application was launched.

SPOTIFY - Current status

Spotify are currently operating 58 regions including American region, European zone, Australia and a few Asian region including Hong Kong, Malaysia, Singapore and the Philippines.

In 2014, the number of subscribers surged to over 60 million subscribers, which are around 10 million more new subscribers. This number also included the 15 million premium users who paid USD9.99, or other equivalent currency, monthly. Since the number of the customers has been drastic increased over the past few year, the payout contributed to music right holders has also substantial raised from USD300 million in 2012 to USD500 million in 2013 and USD1 billion as of December 2014. This implies that the company has significant improved on their revenue and profit in the recent years.

As of the number of paid subscription, it indicates that they are also very successful in...