Spotify reportedly plans to add video on-demand service

Brian Sin - Mar 25, 2013
Spotify reportedly plans to add video on-demand service

Spotify is looking to change things up by adding exclusive video on-demand (VOD) content to its list of services. It wants to compete with the likes of Netflix, Amazon, and HBO, all of which who have their own exclusive video series that help generate revenue and attract subscribers. Spotify hopes that by developing its own original video content or TV series, it can increase its profit margins.

Sources have told Business Insider that Spotify is currently looking for partners to fund its video on-demand content. Right now, Spotify, even with its large list of subscribers, is suffering from extremely thin profit margins. It has been negotiating with music labels to lower their royalty fees so that it can both increase its profits and perhaps add a free music streaming service to mobile devices in the future.

While exclusive video on-demand content would help Spotify generate income (and one it doesn’t have to pay royalty fees for), it does seem out of Spotify’s niche. The VOD content would most likely be live concert footage and video interviews with various artists. Nothing is set it stone however. It would make more sense if Spotify finally brought music videos to its music streaming service.

On another note, Spotify is also looking to expand its subscriber base by finally entering into the world of television marketing. Its set to launch its first commercial today during the season 4 premiere of The Voice. This may be the first time that Spotify has ever aired a television ad in the United States. The company had previously shunned the idea of marketing, but now that it’s so successful, it’s decided to change its tune.

[via Business Insider]

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