When word came out on Monday that Microsoft will launch a music streaming service by the end of the month, Spotify CEO Daniel Ek must have slumped in his chair with his head in his hands. Spotify was never going to be the only kid on the block – Ek would’ve known that – but for their first direct competitor to be the ‘Soft is pretty bad luck. There’s a lot that Spotify has done right but these are five good reasons why the global immovable object will be too much for music’s current irresistible force:
1) Microsoft will have better content
We’ve all had quite a while to play with Spotify now and I’ll challenge anyone not to have had several disapointments at the depth of their music catalogue. They’ve done a decent job but it just doesn’t compare to any other good music service. Have a quick browse around on iTunes, Last.fm and even Nokia Comes With Music and you’ll realise what a real music library is all about.
It’s all about deals with the record labels and the fact is that Microsoft has a hell of a lot more clout than a Johnny-come-lately start up from Sweden. No offence Mr Ek. You have a fan in me but there’s just no comparison.
Gates, Ballmer & Sons will bowl into all the offices of all the music people and walk out with as many tracks as they like and, at the end of the day, why would you bother with both music services as a consumer when one of them has all the tracks you want and the other doesn’t?
What’s more, there’s a very good chance that they’ll add video too. Now, that might be a paid for service, much in the same way that you can rent TV and films through BT Vision or the Apple Store, but it might also be free, provided the rest of the model proves financially successful.
2) Microsoft will make the model work
There’s quite a few murmurings that Spotify isn’t getting all that many people to sign up to the premium paid for service and I’m not hearing and seeing many different adverts on the player an in the music stream either. It all rather points towards the fact that the business model has yet to become fully viable. Now, I’m sure there’s a long term plan that we’re only seeing the tip of at the moment but those ad spaces now filled with voicemail messages from users aren’t wildly encouraging.
The trouble is that Spotify may never get to the point where there business model starts to reap the dividends with Microsoft wading in as soon as they have. If you’re an advertiser, where are you going to spend your money? Their profile is just too big and Spotify’s only hope here is that Microsoft will be too greedy with their ad price. Still, I can see agencies stumping up the extra cash just to make sure they’re getting the right exposure.
3) Microsoft is already in everyone’s home…
…and Spotify isn’t. This isn’t so much a size issue as one of distribution and exposure. Hang on, that’s basically the definition of size.
Any road, the point is that 90% of the world’s computers are still Windows machines. You and I may have heard of Spotify but you can bet we’re in some tiny percentage that has. Most people are going to hear about Microsoft’s music service first through a million different channels and that’s the one they’ll use because they trust it and it’s like it’s already there. It’s the AOL effect.
Not a lot Spotify can do about that one.
4) Microsoft has Xbox and Zune
Supporting hardware is going to be a big factor here. Spotify has launched an API – limited though it might be – but Microsoft don’t have to wait for people to come and develop apps for them. They’ve already got their own mobile OS. They can slap it straight on the front page of each phone that carries it. They can do the same to every desktop copy of Windows too.
Better still, they’ve got a home music player and mobile one of their very own. They’ve already said that they’re going to get the Xbox involved and they’d be crazy not to get the Zune in on the action too. Not only would it make their music service an obvious universal solution choice ahead of Spotify but it would also start to turn the Xbox into not just a games player but a proper home media centre. £100 says the next iteration is all about integration and HD video streaming.
5) Microsoft will have fewer teething problems
There’s still issues with using Spotify as Duncan pointed out a while back and they’re not the kinds of things that Microsoft is going to get wrong. They won’t have difficulty taking payments, they’re bound to have the kind of code in place to allow the integration of your own music library and anything else that they’ve got a problem with they’ll get sorted quickly. They’ll just throw a team of developers at it. Their platform will be a well oiled machine long before Spotify’s is and that could cost Sweden’s second favourite export.
The flip side to all this is that where Microsoft might be quick to develop they’re going to be slower to implement. When you’re going for total music domination, you’ve all those different platforms and devices to consider. Spotify does’t have that problem. It’s smaller and more agile. It’s not a lot to work with but I know enough about guerilla warfare to know that you’ve got to fight with your strengths and attack your enemy’s weaknesses. For example, if Spotify is thinking of getting into video, it might be a good idea to do it now, quickly. Moving into mobile phones yesterday would also be a big help. It’s time to get prolific.
I’m not a fan of any big corporation, so I’d be sorry to see Microsoft squash the competition, particularly when it’s one we’ve come to know and love. It’s the reach of the multi-national leviathan that’ll do for little old Spotify but there is a hope, and quite a good one, that Microsoft will cock it up. They’ve made plenty of mistakes in the past.
Make users pay for the service, add in too many limiting stipulations, throttle the idea in any way and no one’s going to want to bother with what they’ve got, no matter how big their library.
I’m looking forward to seeing which way they take it come the end of the month. If they’re sensible, this could be the change Microsoft has been looking for – a move away from piratable software and into money making services. If it works well enough, maybe even Windows will be free in the future? Nah.