We reported yesterday on two of the big announcements from Spotify’s ‘Investor Day’: its new ‘Reserved’ ticketing feature for superfans and its deal with Universal Music Group for AI fan covers and remixes. But there were plenty of other talking points from the day.
Among them: co-CEO Alex Norström revealing that between 2021 and 2025 “streaming hours per subscriber increased globally by 10%” while setting out the targets Spotify wants to reach by 2030: “One billion subscribers, one hundred billion [dollars] in revenue, and over 40% in gross margin.”
He also elaborated on Spotify’s evolving super-premium strategy: that “there is no such thing as an average user”, and that big growth ahead may come from the “lots of people in Premium who are prepared to spend even more” – through “add-ons that would let us capture the full head of that curve”.
“From the outside, Spotify has always looked like a simple two-step funnel: Free and Premium. Large in size with a massive TAM [total addressable market], but ultimately capped in ARPU [average revenue per user],” he added.
“But what we are outlining today is actually a platform for a diverse set of higher ARPU products. Each with smaller individual TAMs, but much higher ARPUs. And thanks to our scale, this represents many millions of users, and a tremendous upside.”
The UMG AI deal is one of those. Others sit outside Spotify’s music business, particularly in podcasts.
‘Personal Podcasts’ is one such feature: a feature using AI to generate daily or weekly podcasts based on a prompt and the listener’s taste profile. Launching first in the US for Spotify Premium subscribers, it will include “a set number of monthly credits included and the option to purchase more”.
Another AI-meets-podcast launch is called ‘Studio by Spotify Labs‘, a standalone desktop app that sprang a surprise in being Spotify’s equivalent of Google’s NotebookLM: a tool using AI to “create audio shaped around you”.
Spotify said that the tool can “an create a private daily briefing just for you, build a playlist for a long drive, or generate a short podcast on a topic you want to learn more about” – saving the results directly to people’s libraries. For now this is a “research preview”, so details on how much it’ll cost extra (if anything) as a commercial feature are unclear.
“Today, there is no media player for both public and private content,” said co-CEO Gustav Söderström during yesterday’s event. “Or put differently: there is no media player for the generative era. We believe Spotify will become that.”
Finally, there was a data point on Spotify’s growth in India, with VP of markets and subscriptions Gustav Gyllenhammar saying that the company is now “the leader in audio-streaming” there, and that India “now sits alongside the US as one of our largest markets by MAUs [monthly active users].”
Music Ally South Asia has more analysis on this, suggesting that if Spotify has overtaken previous market leader JioSaavn, it may be well past the 100m MAUs mark, and reporting on Gyllenhammar’s claim that Spotify subscriptions in India have grown sevenfold since 2022.
