Daniel Ek is 31 years old. As college students, we are only a few years younger. But by the age of 31, Ek has developed Spotify, a powerful music streaming service that is not only the most convenient and vast, but is feeding the music industry millions upon millions of dollars.
Ek’s path to captaining this juggernaut of the music streaming industry is not unlike other music service moguls, such as Sean Parker of Napster. Joining forces with Parker, Ek was caught up in the “pirate band” of the mid-2000s. The problem with this craze was that it was not at all legal.
Spotify is different. Using advertisements and paid subscriptions (no more than $10 a month), they can effectively pay artists royalties depending on the amount of plays each song gets. Some artists such as Thom Yorke and Taylor Swift (who recently had all of her tracks removed from the service) believe Spotify hurts the industry greatly, but since all artists are welcome, it can be a great tool for artist exposure.
The growth of Spotify in the last few years is astounding. Available in over 50 countries, it is an international force that brings in all kinds of revenue. Artists are being paid millions of dollars. But Ek still wants more. “I’m an impatient guy, so while we’ve added almost 30 countries, we want to move faster and get the industry back to growth again.”
Although artists, critics and fans complain of the decline of the music industry as a whole, there’s no doubt that the growth of Spotify has propelled it past a number of highly touted competitors, such as Pandora. While Pandora is a glorified radio station, Spotify allows a vast and precise library for any user to browse. It even offers a radio function not unlike Pandora’s, allowing a great deal of user control and choices. This is all while Spotify pays out about 6 times more per track play than Pandora. But how could they possibly improve Spotify beyond catalog size and convenience?
“We can take this technological shift, and move it from not just being about listening to music, to being about even how we create music. Because for me, music has always been constrained by the format it’s been on” stated Ek in an interview with Charlie Rose. I agree that with any music provider, no matter how much is available and how many options you have to do with it, it has not gone past being viewed as a utility, rather than a creative, interactive experience.
Interactivity is the next big step for Spotify gaining momentum with not only the utility of a music player, but the social aspect of music sharing and the creation of music. Ek can see it happening, and at such a young age, anything is possible with such a trailblazing visionary at the helm.
With any company, however, there are some questions that have to be answered in time. Will the royalty checks get any larger for artists? How will new creative features of Spotify work, and how will they be received?
Stay tuned, but more importantly, keep listening.