Wednesday, 18 December 2013
Spotify user numbers grow globally as company’s UK revenue falls
Spotify UK drop into the red last year, since subscription revenue fell and the music streaming service invested more in growth here.
When compared to 2011’s profit of £21 million, accounts reveal Spotify’s British arm made a loss of £10.1 million in 2012.
Down from £96.5 million a year earlier in 2012 it fell to £92.6 million, the online music streaming platform saw this revenue fall.
The decrease in revenue was partially down to its decline in subscription, which fell from £72.4 million to £64.7 million because of the alteration in the way subscriptions were booked.
A minimal increase was seen by UK advertising on the platform, rising from £8.1 million to £9.1 million to the year ending December 31. Sources say that subscription numbers have been growing strongly in 2013 thanks in part to partnerships with the likes of Vodafone.
Spotify UK declined to comment on its accounts but earlier in the year parent company Spotify Group said: “In 2012 the business focused on driving user growth, international expansion and product development, resulting in soaring user numbers and increased market penetration.
“Our key priority throughout 2013 and beyond remains bringing our unrivalled music experience to even more people while continuing to build for long-term growth – both for our company and for the music industry as a whole.”
With its operations in the thirty two countries around the world, Spotify lets users stream 10 hours of music a month for free with advertising or pay a subscription fee for unlimited, advertising-free listening. Naming Sony, Universal and EMI, and to date has paid out $500 million in royalties to artists, the company has signed deals with major record labels with the said records.
With 5 million paying subscribers Globally Spotify saw users leap from 11 million to 20 million in the year. UK numbers were not disclosed. From March this year figures demonstrate this has augmented to 24 million users and 6 million subscribers. In the previous year was the first year that digital sales make up for a decline in physical sales in the music industry.
Spotify UK, headquartered in London’s Soho district nearly twofolded staff in 2012, upwarding the company from 64 to 111 people. Spotify UK’s highest paid director took home £95,625.