Tags: spotify | ipo | apple | music

Spotify IPO Hits Sour Note as Apple Music Surges

Spotify IPO Hits Sour Note as Apple Music Surges

(Andrius Aleksandravicius/Dreamstime.com)

By    |   Tuesday, 06 February 2018 02:04 PM

Spotify's IPO could hit a sour note if Apple Music continues to surge, with the Wall Street Journal predicting that Apple may overtake its elder competitor by the summer.

Spotify, out of Sweden, is the current king of music streaming with 70 million paid subscribers around the world compared to Apple Music's 36 million, according to CNBC.

Apple Music, though, has been signing up customers rapidly since rolling into the streaming music market in June 2015. The Wall Street Journal reported that Apple now is leading in U.S. subscription growth at a rate of 5 percent compared with Spotify's 2 percent.

Spotify and Apple have boosted their numbers by counting individual users who are part of family plans and people with discounted subscriptions bundled with other services, the Journal noted.

Spotify is expected to make its initial public offering in late March or April. The Stockholm company currently is opting to directly list on the New York Stock Exchange, making its shares available only to institutional investors, according to Fortune.

The New York Times wrote in January that the unusual IPO move, where no new stock is issued and no money is raised, would allow existing investors and insiders to trade their shares on the open market.

The newspaper said the listing would allow Spotify to bypass much of the bureaucracy of a standard initial public offering, saving the company time and potentially millions in underwriting fees.

Spotify would be the most prominent music-related listing since Pandora Media in 2011 to issue an initial public offering, the Times said. Music sales, thanks to streaming companies like Spotify, started to rebound in 2015 after 15 years of decline in music sales and eroding revenues, the newspaper noted.

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Spotify is under increased pressure from Apple Music, which is rapidly adding subscribers as Spotify nears an anticipated initial public offering.
spotify, ipo, apple, music
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2018-04-06
Tuesday, 06 February 2018 02:04 PM
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