I don't think this is a good long term investment.
Disclaimer: I worked for a Spotify competitor in the past, so i have a pretty solid understanding of how the business works.
I think it is a bad investment for one simple reason: Spotify purchases its main product (music) from a oligopoly. I'd estimate that 95%+ of the tracks streamed (by total playtime) are from one of the 3 major music labels: Universal, Sony or Warner. That includes sublabels that in some cases may have a seperate deal with Spotify, but at the end of the day are still part of the big 3. Imagine you are a Sony executive, walking by a news stand and the Wall Street Journal Headline is "Spotify Q2 earnings 30% up". What are you gonna do? You will squeeze them, make them pay, just enough that they survive. And Spotify has zero negotiation power here. If Sptify fails to have a deal with any 1 of these 3 labels, they become useless overnight. People will switch to Apple Music, Amazon PrimeMusic, Tidal or any other service quickly. It doesn't matter if Spotifys app is slighty better than the competitors software if they lack 1/3 of the music.
Disclaimer: I worked for a Spotify competitor in the past, so i have a pretty solid understanding of how the business works.
I think it is a bad investment for one simple reason: Spotify purchases its main product (music) from a oligopoly. I'd estimate that 95%+ of the tracks streamed (by total playtime) are from one of the 3 major music labels: Universal, Sony or Warner. That includes sublabels that in some cases may have a seperate deal with Spotify, but at the end of the day are still part of the big 3. Imagine you are a Sony executive, walking by a news stand and the Wall Street Journal Headline is "Spotify Q2 earnings 30% up". What are you gonna do? You will squeeze them, make them pay, just enough that they survive. And Spotify has zero negotiation power here. If Sptify fails to have a deal with any 1 of these 3 labels, they become useless overnight. People will switch to Apple Music, Amazon PrimeMusic, Tidal or any other service quickly. It doesn't matter if Spotifys app is slighty better than the competitors software if they lack 1/3 of the music.