In addition to the struggle of finding a path to profitability, Spotify, the pioneer of music streaming (and a company which I have been following since its closed beta launch in Sweden in 2007), has two new problems, one right now and the other in the mid to long term.
The near-term problem is Apple’s smart speaker HomePod which will go on sale in the US, UK and Australia this Friday, with additional markets to follow in the upcoming months.
HomePod will only play well with Apple’s own music streaming service, Apple Music. Other streaming apps can be used via AirPlay, but HomePod owners won’t be able to control playback through their voice.
In the US, Apple Music is already said to be gaining subscribers at a higher rate than Spotify. For every new owner of an HomePod, Spotify will be a worse choice than Apple Music. Existing Spotify subscribers in the US who decide to purchase an HomePod will have a big incentive to switch, and Apple makes it easy by offering a free trial for Apple Music. Continue Reading