‘Private company financial data authority’ PrivCo has been making waves with a report on Spotify’s 2011 financials, publishing full figures for the streaming service’s year. They show revenues of $244.5m – up 151% on 2010 – but a cost of sales of $238.9m and a net loss of $59.1m. The figures aren’t a huge surprise – they’ve been talked about in broad terms before by Swedish publications, then the Wall Street Journal. What’s causing a stir is PrivCo’s bearish verdict on Spotify’s business model: “Virtually every new dollar of revenue went directly to music companies as royalty payments,” notes its report. “As currently designed, Spotify’s business model is unsustainable.” Its calls for either a $25-a-month ‘Spotify Platinum’ tier for the service, or a change in its music royalties commitments, look unlikely to be answered, though.
Tools: platforms to help you reach new audiences
Tools :: We Are Giant
With “fan communities” being on every artist’s team’s mind, we’re fans of the fact that…