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What is the biggest hurdle to profitability for Spotify?
Spotify’s biggest hurdle to profitability is at the gross margin level where it pays out more than 70% of its revenue in royalties. Spotify needs to leverage its sizeable and growing audience to negotiate increasingly favorable contracts with labels to improve gross margins.
How does Spotify differentiate itself from other music services?
While individual songs are not exclusive and can be accessed from other music services, Spotify seeks to differentiate and keep users on its platform with its superior user experience, curated playlists, discovery mechanisms, and data-driven personalization. Maintain or improve margins in the ad-supported business to unlock costless, rapid growth.
What can I do with a Spotify Fellowship?
Our fellowship program is for aspiring software engineers just entering the tech industry, giving you the chance to work on exciting live projects and feature work with the help of our experienced mentors and managers. Coding bootcamp, community college - where you studied doesn’t matter.
What are some of the risk factors for Spotify?
There are a number of risk factors to Spotify’s long-term prospects, including: Spotify is dependent on third-party licenses for music streaming content. Recent changes to copyright laws will increase the streaming royalty rates due to songwriters and music publishers, and could negatively impact gross margins.
Last Update: Oct 2021
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