Thursday, August 1, 2013

What Can Spotify Learn From Netflix and Hulu?

Bruce Houghton/Hypebot

Spotify has been taking a few hits lately. From Thom Yorke to Pink Floyd, a small but growing list of significant artists and smaller labels are speaking out about what they see as unfair payments to artists. But what happens to Spotify and other music streamers, if these voices grow in number? Can a service built on the completeness of its catalog survive if there are gaping holes in its collection?

It can, if it learns two lessons from subscription streaming video services like Netflix, Hulu and Amazon Prime.

Positioning
Netflix and its competitors were never promoted as full replacements for a cable subscription plus trips to the movie theatre. Consumers may be more understanding of holes in the catalog, if subscription music positioned itself at the center of a consumer's music ecosystem rather than as replacement for all if it.

Original Content
Netflix, Hulu and Amazon have differentiated themselves with successful original programming. Fans are far more forgiving of holes in the catalog if, in addition to broad content, streamers offer something subscribers can't get elsewhere.

An exclusive recording of the opening night of a sold out concert tour or a star's unreleased studio sessions might be costly to procur, but they could be Spotify's version of House of Cards or Arrested Development.

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