Spotify UK Loses $16.3M, Blames “Redistribution of Revenues”

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Spotify UK reported a loss of £10.1 ($16.3) million in 2012.

Sounds like bad news, though the ‘good news’ is that Spotify says the loss is due to a ‘redistribution of revenues,’ not declining users.  Spotify’s global premium subscription revenue shifted from the UK branch to local branches in June 2011, which skewed year-over-year comparisons.  Revenues went down 4.1 percent.

Total revenue went from £96.5m in 2011 to £92.6m in 2012.  Revenue from subscriptions went from £72.4m to £64.7m.

Overall, Spotify doubled revenue in 2012, but they spent more money (and doubled their staff).

14 Responses

  1. Anonymous

    “Overall, Spotify doubled revenue in 2012, but they spent more money.”

    Did their spending double? Or were their losses a lower percentage?

    Reply
    • Anonymous

      Who cares.

      Spotify is dying, and we all need to focus on YouTube and iTunes now.

      Reply
      • GGG

        Or we can focus on all three? YouTube already has the traffic and shitty pay. Why not focus on getting a better paying service more users? Wow, you meant everything doesn’t have to be black and white. Imagine that!

        Reply
        • Faza (TCM)

          I can’t believe I’m sticking up for YouTube, but I do have to point out that my most recent payments from them have actually hit the level that could turn streaming into a viable revenue stream: just south of 3 cents per play. Would be lovely if anyone else had numbers to share.

          Spotify has been gradually getting better, but they’re not quite there yet: the highest payment I’ve seen from them was around half of the YouTube figure. This is only to say that our notion of “better paying” might be due for some revision (or it just may have been a fluke – that’s the trouble with streaming as a revenue stream).

          Reply
          • Faza (TCM)

            Might if I can find the time to set some kind of spreadsheet up. Not sure it’s worth the bother for a couple of plays that may have been a fluke. It would be nice to have other people with more YouTube traffic than me to trade notes – I have to say I was surprised myself, given how previous payouts tended to hover around the 0.15 cent mark (with possibly the lowest payout I’ve seen from anyone ever among them – a thousandth of a cent per play).

          • Paul Resnikoff
            Paul Resnikoff

            We’re working in a forum expansion. Might be the perfect place for everyone to add those little snippets, or gigantic spreadsheets.

          • Faza (TCM)

            Almost as soon as I’d posted the above, I realised I’m overthinking this, since it’s clearly a “pictures or it didn’t happen” kind of situation (serves me right for commenting just before heading out to rehearsal). What I’ve therefore done is grabbed a screenshot of my CD Baby report. Offending number underlined: Viridian Rumblefish licensing report.

            A few words of explanation: the payments are from the Rumblefish MicroSync service, via CD Baby. MicroSync monetises synchronisation rights on videos posted to social media networks, including YouTube (obviously). YouTube is the only social video site we have a presence on, so while it is possible that the payments in question aren’t from them (since the source isn’t spelled out – unless that’s what Sync-Y means), it is highly unlikely. The amounts are net of CD Baby’s 9% cut, plus whatever Rumblefish takes.

          • GGG

            That’s great then. So yes, we should focus on all of the above. I find it strange so many people on here think we have to cut something out whenever something new comes around. Just do all of it!

          • Faza (TCM)

            I’ve been meaning to ask you this for a while now: don’t take this the wrong way, but do you have a share in Spotify? The reason I’m asking is that I’m finding it hard to imagine any other reason to actively push in favour of one particular company.

            See, my opinion of the music biz – old or new – is fairly low, so I tend to look at the terms on offer and pick the ones that look best for me at the moment. I presume most people do the same. I don’t particularly care about being on any given service, unless I think it’s a good deal and as you may have already gathered I don’t think Spotify is – and I’m hardly alone in my sentiment.

            So why should you, or anyone else, care whether people are sticking their music on Spotify or not? I mean, it’s not like they’re in any way special – couple of years on someone like Deezer or maybe Apple or Gogle might eat their lunch and it’s likely that the service-to-user will be substantially similar (assuming that the supply side of the market will push for the same terms regardless of who’s involved).

            I understand you might have a particular fondness for Spotify, but in that case wouldn’t it be easier to just shrug your shoulders at the naysayers and move on? They’ll cotton on to a good thing in their own time, right?

          • HansH

            Shrug shoulders and move on. That’s what I’ve been doing for some time now.

          • GGG

            No, I use Spotify mainly to stand for for all streaming, mostly because it’s the service I use and that it has the most traction. I have nothing against Rhapsody or Rdio or anything else. If Deezer launches here and blows Spotify away, it won’t make a difference to me. I’ll either move over to Deezer or not really care. And if it causes more people to start subscribing to streaming, then fantastic. It’s also partly because Paul/DMN seem to think Spotify is Satan incarnate yet don’t get up in arms about any other service that does the exact same thing for the same or less amount of money.

            Also, I don’t particularly care if anyone puts their music on, I argue for pushing listeners to join, not bands. To me it makes no sense that after a decade plus of continually falling sales, the one potential saving grace for bringing money back from piracy is being shit on by half the industry. Show me a better idea and I’ll be all over it. Telling people to buy CDs again is not a better idea, though. You can push for it, and certainly push for vinyl, but it’s silly to focus all your energy on it and actively rail against the growing alternative.

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