Following the publication of Spotify's Q1 2020 financial results, CEO Daniel Ek and CFO Paul Vogel took questions from analysts on a conference call.
Ek was clear that its competition is more wide-ranging than just other streaming services:
Both short and long term, we are always thinking about Spotify’s role within the larger ecosystem. While most (external) focus is on competition between streaming services, we continue to be focused on the billions of users who are listening to linear radio.
He repeatedly suggested the big audio trend of the next two decades is a move from linear to on-demand, following on from former CEO Barry McCarthy's line in September 2018:
The 20-year trend here is linear dies, everything on-demand wins.
Of course, this would be the equivalent of Amazon suggesting shops will cease to exist as a result of online orders increasing - an ideal scenario for them.
If the in-store experience disappeared completely, which will obviously never happen, it would be a matter of days before someone somewhere thinks "hey, why don't we open a shop?"
Spotify believe the move from linear to on-demand will be accelerated by the COVID-19 pandemic. I would suggest radio streaming figures and listener interaction across the board tell a different story.
We should not underestimate Spotify which will continue to grow, rapidly, as an audio platform.
While on-demand will continue to reach new heights, and radio brands will need to expand and take advantage of this going forward, it will never destroy the concept of live, interactive and relevant audio or video.
How long before Spotify backtrack on this rhetoric and decide to go for a slice of the pie themselves?
I'd put money on it.
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