Spotify can't use the popularity of a podcast to justify dropping Ariana Grande from its service. Spotify can't really do this as a big part of the appeal of a service like Spotify is that it offers a comprehensive library. Subscribers are OK with the service not offering everything.
If Netflix's originals are popular enough, the company can afford to pass on pricey licensed content. Netflix's content deals virtually never include per-play bonuses, so a Netflix user who opts for originals over something Netflix bought from someone else does not immediately save Netflix any money.īut Netflix's original content strategy offers a more powerful way to save. Every minute that Spotify users spend streaming Spotify original podcasts instead of Ariana Grande is a minute that Spotify does not have to pay the owners of Ariana Grande's music for. Since some of Spotify's expenses are per-play payments, it can save money whenever users choose Spotify originals. But Spotify's original content strategy won't work exactly like Netflix's. Spotify's planned purchase of two podcasting companies signals that the company will seek to produce original content to keep costs down. Music streaming services do not seem likely to sign bands and compete with record labels anytime soon, but Spotify has emulated the Netflix strategy in the podcast world.
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