Spotify looks to video to change financial fortunes

DetailsMichelle Clancy | 21 May 2015

Spotify, the subscription Internet music service, has implemented short- and long-form video content into its popular platform.

Content partners at launch include digital doyennes like Maker Studios, Rightster and Vice Media, and TV outlets like ABC, BBC, ESPN, NBC, Comedy Central and Turner Broadcasting. In addition, Spotify said it is introducing original content, including a series called A Full English.

The move is a big shift in strategy for the European company, which launched in the US a few years ago to much interest but so far little (or no) profit. There's a free version that allows a certain number of specific song requests per month as well as a themed radio service, in addition to a paid premium version that allows users to select and play whichever song they choose, on-demand. The addition of video could encourage more users to upgrade to the paid version by adding more value.

"We're bringing you a deeper, richer, more immersive Spotify experience," said Daniel Ek, founder and CEO at Spotify. "We want Spotify to help soundtrack your life by offering an even wider world of entertainment with an awesome mix of the best music, podcasts and video delivered to you throughout your day. And we're just getting started."

Not everyone is wholeheartedly bullish on the launch; the quality of experience for the video will make the difference between success and failure, according to Simon Jones, VP of marketing at Conviva.

"Consumers, increasingly drawn to the transactional and self-guided nature of video-on-demand (VOD), are expanding their use of Web-delivered video, and making choices for premium entertainment beyond the set-top box," he said, in an emailed comment. "A premium service, of course, requires a premium experience consumers engage most when they are served an optimised experience, and then disengage when they are dissatisfied. So it's a calculated risk for Spotify: with excellent content, delivered smoothly, they can capitalise on the global shift to net TV; missing on the quality of experience on video which they have aced with audio could represent a challenge to their otherwise pristine brand image."

As far as the content goes, various media companies are offering limited slates to the service. For instance, in the US, Turner will offer content from Adult Swim series such as Robot Chicken, Aqua Teen Hunger Force, Rick and Morty, and Tim & Eric's Awesome Show, along with buzz-worthy clips from TBS's late-night talk-show hit, Conan. In addition, full episodes of the aforementioned hit series, as well as other original series like Black Jesus and Mr Pickles, will be available to Spotify users in the UK, Germany and Sweden, with more territories to come.

For Turner, the deal is an extension of its existing multiplatform initiative. "It's vital that we make our content available to consumers on as many platforms as possible," the company said in a statement. "This deal reflects yet another opportunity to distribute Turner's award-winning and highly popular programming to new audiences through a high-profile delivery channel, providing both additional exposure and more consumption of our global portfolio of leading brands."

In the digital realm, Rightster said that it will focus on providing Spotify with short-form content from several verticals, including celebrity and entertainment, news, fashion, sport and social, to expand its exposure to Spotify's millions of users.

"This is an incredibly exciting evolution of Spotify's already highly engaging service and the perfect opportunity for us to leverage our multi-platform network of content owners to help it entertain its users via a new medium," said Daniel Fisher, SVP of audience solutions at Rightster. "We are looking forward to adding Spotify to our expanding platform, portal and publisher roster, building an even bigger audience for Spotify and our content partners."