Spotify has more than 600 million active users – IT Pro – News


Who is the “them” who “broke open” Netflix? You mean the concept of competition? Just as there are entrants in every market where there might be money to be made? There is no big bad “them” involved and nothing to do with breaking it open. Parties such as Disney, Apple and Amazon wanted to offer a streaming platform themselves.

And yes, I understand that fragmentation is an inconvenient disadvantage of competition when it comes to platform companies. No one wants to check dozens of platforms to find the music or TV series they are looking for. But that problem can be avoided in several ways, and running a monopoly is not one of them. Monopolies lead to the lowest quality we tolerate for the highest price we tolerate. And for the creators of the content (musicians, rights holders) negotiating is then virtually impossible.

Fortunately, Spotify doesn’t have a monopoly either; there are several major music streamers. The problem of fragmentation is largely avoided when the same content is present on multiple platforms. This works mainly well with music streamers and not with video streaming. You can find a lot of music on Spotify as well as Apple Music, Youtube Music and more; the catalogs are not very different from each other. That is very useful and desirable. Video streaming does much more with exclusivity and that is where the real fragmentation lies. This also applies to game launchers on the PC.

Perhaps equality in content could be enforced more among video streamers, but for music this works well through market forces alone.

Having fewer and fewer players in a market, just because of that annoying fragmentation, is not a useful wish to have. Then we shoot ourselves in the foot. A healthy number of players in a market is essential. Fragmentation will have to be reduced in other ways where necessary.