Facebook Music Moves
Facebook caused a bit of a stir this month by advertising several new senior music focused positions that refer to the implementation of a “comprehensive music strategy”.
This has resulted in widespread speculation that Facebook is eyeing up Spotify, either as a potential acquisition or competitor that it will seek to wipe out, death star style.
Neither of which may be true but that never got in the way of a good story and the new positions are interesting- they include a Legal Director of Music Licensing and a label Music Business Development Lead that will be responsible for “Leading Facebook’s strategy and negotiations’ with music labels throughout the world”.
On one level, the acquisition theory makes sense- Spotify has built a leading service with a paying subscriber base of 50m and total user base of 125m but it is struggling to make revenues or the model work in comparison to, say, Netflix. Facebook had no qualms about snapping up Instagram and taking a few leaves out of Snapchat’s book- are Spotify next? However, Facebook has 1.86bn monthly active users and would only need to convert a fairly tiny percentage of those users to a native service to swiftly eclipse all other music streaming offerings.
Is the long game that Facebook are looking to build a service model?
With persistent rumours that Amazon are considering the acquisition of a major live music promoter, things are about to get interesting as the major technology companies make further moves into the music space. To give some perspective on this, the IFPI reports that total music industry revenues grew 3.2 per cent to $15 billion in 2016.
In comparison, Amazon reported $135.99bn in gross revenues in 2016- in other words, the entire music industry is relative chicken feed to such companies and, with a recent move into ticketing, there are interesting and potentially turbulent times ahead.
In related news, Spotify this week announced the acquisition of MightyTV, a start up that provides video recommendations through an app that uses a tinder style swipe interface to guide users to TV shows and films compatible with their tastes.
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