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Spotify Worth More Than Entire Music Industry

According to The Wall Street Journal, Spotify is now worth more than the entire US recorded music industry, after securing $400 million in fresh funding.

The latest deal has pushed the streaming service’s net value to an estimated $8.4 billion, more than double than its competitor Pandora ($3.5 billion). Both music services are No. 3 (Pandora) and No. 4 (Spotify) on the U.S. iPhone revenue charts. The Recording Industry Association of America illustrated that the revenue of the entire music industry was $6.97 billion as of 2014, accounting for physical sales, digital purchases and streaming.

The data, however, is actually comparing two different things, in that one is net value (Spotify’s $8.4 billion) and the other is revenue (RIAA’s $6.97 billion). The report is suggesting that Spotify is more valuable overall, and that with the way things are trending, the US music industry’s valuation could one day equal its revenue.

Spotify

Spotify currently has 45 million free listeners and 15 million subscribers who pay $9.99 per month for the premium account that provides ad-free listening.

Earlier this month, Spotify announced that they plan to include other ways that advertisers can reach and attract music listeners. Those who are using the free service listen to ads in between songs or can view ads on the desktop web player.

“Starting May 1, brands will be able to target unique audience segments based on streams from Spotify’s 1.5 billion-plus playlists, from workout enthusiasts and commuters to millennials, parents and more. All targeted campaigns are delivered with 100% share of voice to a highly engaged audience cross-device – 148 minutes per user per day (Source: Spotify internal data)… Brands can now target audience segments based on who they are (age & gender, geography, language), what they’re listening to (playlist, genre), and when and how they’re listening (time of day and by platform/device).”

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