Worst Idea Ever? Spotify Rival Deezer Is Launching an IPO

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Spotify is the megaton streaming service that just can’t figure out how to go public.  That’s because Wall Street can’t figure out how Spotify makes money.

So, why is Deezer, a streaming service in Spotify’s shadow and a non-presence in the US, planning to go first?

Let’s see how this one goes.  According to details confirmed by the globally-oriented streaming upstart, IPO plans are definitely in the works — in France, that is.  “Streaming is the future of the music business and we are just at the beginning,” Deezer CEO Hans-Holger Albrech told a group of journalists.

“For now it is about accelerating our growth with the IPO.”

Deezer isn’t Spotify, but it does have 6 million subscribers across 180 countries.  It also has some familiar financial issues: according to documents now disclosed, Deezer’s revenues ballooned 41% in the first half of 2015 to €93 million, or $103.6 million at current exchange rates.  But the company still remained in the red, with a €9 million loss.

Then, there’s the issue of subscribers.  For Spotify, deadweight non-paying subscribers are a major issue, though that seems less the case for Deezer.  The company indicated that our of its 6 million ‘subscribers,’ 3.7 million brought in 92 percent of the revenues.  Advertising raised just 3.7 percent of the revenue total.

Sound familiar?

 

 

5 Responses

    • Remi Swierczek

      There is other and better option.
      Convert #Radio and streaming to conventional farm market style music stores THEN go for mucho big IPOs.

      Google is the biggest bully or the best friend of this simple $100B metamorphosis of music industry!

      Reply
      • Not as awesome as Remi Swierczek

        Hashtags in a comments section that does not register hastags? Really? I thought you were better than that. I BELIEVED IN YOU REMI, NOW WHAT DO I DO?!?!?!

        Reply
  1. Anonymous

    This company should fire everyone who had anything to do with the US launch. They had the opportunity to be the first major lossless service in the US. They could have completely eaten Tidal’s lunch before Tidal was even born. And what did they do? They made some shitty exclusive deals that no one cared about and completely blew their chance at leading the largest music market in the world. Want their service unbundled? Still unavailable. Pathetic.

    This company is trash propped up by deals with service providers. Without their partners they are nothing. I wouldn’t invest a cent in Deezer.

    Reply

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