Leading music streamer Spotify has reported revenues of $3.3 billion for 2016, an impressive 52% spike on the previous year’s $2.2 billion. And the company’s headline sales figure amounted to around half of all global streamed music revenue of $7.6 billion in 2016. Less impressive was the loss of $600 million, a huge 133% deepening on 2015.
Spotify’s subscription business pulled in $2.9 billion (up 52%), while its advertising business was up 50% to $326m million. Subs accounted for almost 90% of the total, as for just over 10%. The company reported that it now has 140 million users, with 50 million-plus actually paying for the service, and Spotify is now hoping that huge audience will pull in more advertisers.
The streamer needs those ad dollars to offset the growing losses on the subscription side. “Our brand partners now have a bigger opportunity than ever to activate Spotify’s free user base,” says Brian Benedik, Spotify head of sales, bullishly.
Apple Music has just 27 million paying subscribers, up from 20 million in December, and 13 million one year ago. Apple doesn’t release individual financials for its streaming service so it’s hard to compare its metrics with Spotify’s – unlike the latter though, music is not the CE maker’s core business.
Fast fact: Spotify is leaning heavily on Big Data to leverage its platform. The company recently revamped its Spotify for Artists platform, formerly Fan Insights. It sells the offering as a one-stop shop designed to guide musicians through Spotify, giving them access to audience insights and song data.