Spotify vs. Beats – Making Sense of The Echo Nest and Topspin Acquisitions

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Two acquisitions in one week by the major players in music streaming. Beats v. Spotify. And interestingly, they characterize the different strategies each company is taking.

“Beats Music Acquires Topspin.”

“Spotify Acquires The Echo Nest.”

Beats is your artist-friendly, human-curated music service. Super Bowl ads with Ellen. Artist endorsements. AT&T family pricing.

Spotify is your all-encompassing music platform, with great recommendations and social connectivity. Biggest catalog. Free options. Current market leader.

The paths make sense.

Beats has a competitive advantage with artists. It was a gaping void in the market left by Spotify, Rdio, and others.

Spotify was first-to-market and is scaling towards their IPO and beyond.

Similarly, the acquisitions make sense.

Beats acquired direct-to-fan platform Topspin to increase their offerings to artists. They’re aiming to be the artist-friendly music streaming service. The hope is that as more artists love Beats, more music listeners will follow.

Spotify is trying to scale. They have free options for music consumers, they’re available across any device, and they have the most robust catalog. The Echo Nest developed best-of-class music intelligence APIs, used for curation to drive music discovery. If Spotify can make a huge leap forward in music curation/discovery and broaden its’ developer community tools, it’s a game-changer.

But don’t be naive. Both acquisitions were a shot across the bow.

Spotify integrated Topspin’s ArtistLink less than a year ago. Now that Beats owns Topspin, will that continue?

The Echo Nest powered Rdio, iHeartRadio, XBOX Music, VEVO, and more. Do you think Spotify will allow direct competitors full access to APIs that they spent $100mm+ on?

Who knows? But things are heating up.

Spotify. Beats. Pandora. Rdio. Songza. Deezer. Grooveshark. Slacker. Earbits. Plug.dj. The list goes on and on.

Is this a winner-take-all market? Or is there room for more than one?

Acquisitions. Consolidation. Mobile carriers. And more. Coming soon to a music streaming service near you.

  • Joey Flores

    Thank you for the Earbits shout out!

    I don’t think it should go unmentioned that the CEO of Beats was the former CEO of Topspin, and that in addition to the strategic sense it makes that Beats would want a more artist friendly approach with tools such as Topspin’s, it’s probably also a soft landing for the Topspin team that was probably a significant consideration by their former CEO.

    • mattdsandler

      Definitely. It was a small deal, with obvious business and personal motivations. But you’re right, should have included that note. Thanks man!