It’s been proven that there’s a platform that’s screweded
Spotify’s Failures in 2023: An Insight from the Heads of Product, Marketing, and Brand Safety at Omdia
Despite being the most popular music streaming company in the world, it has lacked consistency in its profits. Last January, as it slimmed its business, it cut 6 percent of its workforce, which was followed by 2 percent in June. Even as the world’s most recognizable music streaming service, Spotify is plagued by an unreliable business model, one in which record companies sit back and rake in royalty payments while artists can struggle to bring in enough cash.
Spotify gained momentum in the third quarter of 2023, earning €32 million ($34.6 million) in operating income. It now has 226 million subscribers and 574 million monthly users. Simon Dyson, senior principal analyst of music and digital audio at Omdia, said it looks great on the surface. The nagging costs are the reason it cannot get on top of them.
“The safety of our community, including our listeners, creators, and advertisers, remains a top priority,” Spotify spokesperson Erin Styles told Hot Pod. “Brand safety at Spotify has always been a team effort and will continue to be overseen by leaders across our product and policy orgs.”
There is no executive dedicated to brand safety at the company. Styles told me that the teams across the company address brand safety and pointed to the director of monetization product marketing and the VP of product as key executives in this area.
An interview with Spotify CEO Amrita Khalid about investments and a strategy to take back into the business of putting people out on the road
Ek pointed out in his note that the company was not finished with acquisitions, even though they put so many people out of work.
“Embracing this leaner structure will also allow us to invest our profits more strategically back into the business,” he writes. Every investment and initiative becomes more important with a more targeted approach.
When I asked Spotify whether “investments” means more M&A, Styles said, “We will continue to allocate capital towards the highest return opportunities for the business, both internally and externally.”
That sounds boring, but it’s important! Advertisers need to know that their ads are reaching the right people, and aren’t supporting content that is harmful, if the industry is going to make money. You can check out this interview Amrita Khalid did with Byrne in October about the company’s approach to brand safety.
Source: Spotify’s not going for Pulitzers anymore
The End of the Heavyweight/Stolen Podcast (Ear Buds Podcast Collective): Why a show like Hot Pod is not going for Pulitzers anymore
In his letter to employees, Ek said that “we still have too many people dedicated to supporting work and even doing work around the work rather than contributing to opportunities with real impact.” The impact in question doesn’t mean awards or even an audience. It means margin. Like we have seen at WNYC with La Brega and More Perfect and at APM with In the Dark, Spotify has decided that a show that requires too much time, manpower, and money to make is not worth it, no matter the acclaim.
A high margin show is something that is straightforward to make, always on, and has broad appeal. You can see it in the company supports interview shows like emma chamberlain and Call Her Daddy. It’s important to have time and resources to make the Sopranos of podcasting.
Ear Buds Podcast Collective founder Nissenblatt told Hot Pod that it felt like the end of times. “I know podcasts are still kinda new to many people but canceling #heavyweight is like canceling Breaking Bad or the Sopranos,” posted Jay Cowit, former director of The Takeaway and Freakonomics. “A Pulitzer and a Peabody and one of the most critically acclaimed shows Gimlet has ever had! Truly what is one supposed to do to keep their job in this industry,” said former Gimlet producer Meg Driscoll.
I have some hope that this is not the end for Heavyweight or Stolen, as both shows will be allowed to be shopped elsewhere. These are the kinds of shows every studio wishes they had and the kind of content a startup likeSpotify wanted when it decided to start using podcasting. Whatever has been unforgiving has been received on the show.
Source: Spotify’s not going for Pulitzers anymore
How Can We Rethink the Costs of Running Our Business? A Recommendation from Daniel Ek, M. A. Seiberg, CFO, C.A.C.?
“I realize that for many, a reduction of this size will feel surprisingly large given the recent positive earnings report and our performance. In a letter to employees, Daniel Ek said that they discussed making smaller reductions in the years to come. “Yet, considering the gap between our financial goal state and our current operational costs, I decided that a substantial action to rightsize our costs was the best option to accomplish our objectives.”
