As an assignment in the course Innovation, Concept Development and Project Management at ITU we were asked to do a SWOT analysis of a web based product/company of our own choice. We decided to go for Spotify. Thought I should put it up here, as some might find it a little interesting how three IT students in Denmark look at strengths, weaknesses, opportunities and threats at an not-yet launched in DK music service like Spotify. Please keep in mind that this is just a practice assignment and is therefore not to be taken too serious (it is done in less than an hour a Friday afternoon).
Internal: Strengths
Technology (p2p), streaming, a large music library available, it’s all in the cloud – no storage issues, easy to use music search, you may compile and share playlists, social aspect (i.e. sharemyplaylists.com and synchronization with last.fm), legal, free, possibility to sign up for monthly or daily subscription(s). It is also possible for offline use with premium subscription (on computer or portable devices such as iPhone and Android phones). They have an application programming interface (API) for developers.
Internal: Weaknesses
Territorial limitations, limited offline use (at least if using the free subscription service), people will go for other free (illegal) alternatives as they won’t listen to advertising, limited compatibility with devices (unless you have iPhone or Android). The free subscription alternative has so far proven to bring in poor revenues, and it might be hard to get “enough” paying customers (“why pay for music online”). Some developers aren’t too impressed with the Spotify’s API and its limitations.
External: Opportunities
Strong and well known brand. The people behind the service are also known for other successful start ups (i.e Stardoll and TradeDoubler). Possibility for partnership with ISPs and other IT companies (i.e. Google in the US and Telenor in DK). Partnership with the music business in the EU (possibility for such partnership outside the EU too). The music industry strive to fight piracy and might look at Spotify as the right tool to do so. Market tendency towards the Spotify business model (streaming, the cloud, social aspect, music here and now, easy to use).
External: Threats
Strong competitors in for instance iTunes (and other streaming services). Especially with competitors product development (i.e. iTunes LP and music DNA – digital artwork in LP format). Spotify also compete with illegal services, both download (Pirate Bay etc) and streaming (Grooveshark). Issues with right holders (i.e. KODA in Denmark). Low royalty payments might lead to artists and record labels wanting to flee the service. Partnership with the music industry leads to an increase in credibility amongst certain (potential) customers (i.e. the Pirate Movement in Scandinavia).
SWOT Analysis Spotify – market competitiveness
As an assignment in the course Innovation, Concept Development and Project Management at ITU we were asked to do a SWOT analysis of a web based product/company of our own choice. We decided to go for Spotify. Thought I should put it up here, as some might find it a little interesting how three IT students in Denmark look at strengths, weaknesses, opportunities and threats at an not-yet launched in DK music service like Spotify. Please keep in mind that this is just a practice assignment and is therefore not to be taken too serious (it is done in less than an hour a Friday afternoon).
Internal: Strengths
Technology (p2p), streaming, a large music library available, it’s all in the cloud – no storage issues, easy to use music search, you may compile and share playlists, social aspect (i.e. sharemyplaylists.com and synchronization with last.fm), legal, free, possibility to sign up for monthly or daily subscription(s). It is also possible for offline use with premium subscription (on computer or portable devices such as iPhone and Android phones). They have an application programming interface (API) for developers.
Internal: Weaknesses
Territorial limitations, limited offline use (at least if using the free subscription service), people will go for other free (illegal) alternatives as they won’t listen to advertising, limited compatibility with devices (unless you have iPhone or Android). The free subscription alternative has so far proven to bring in poor revenues, and it might be hard to get “enough” paying customers (“why pay for music online”). Some developers aren’t too impressed with the Spotify’s API and its limitations.
External: Opportunities
Strong and well known brand. The people behind the service are also known for other successful start ups (i.e Stardoll and TradeDoubler). Possibility for partnership with ISPs and other IT companies (i.e. Google in the US and Telenor in DK). Partnership with the music business in the EU (possibility for such partnership outside the EU too). The music industry strive to fight piracy and might look at Spotify as the right tool to do so. Market tendency towards the Spotify business model (streaming, the cloud, social aspect, music here and now, easy to use).
External: Threats
Strong competitors in for instance iTunes (and other streaming services). Especially with competitors product development (i.e. iTunes LP and music DNA – digital artwork in LP format). Spotify also compete with illegal services, both download (Pirate Bay etc) and streaming (Grooveshark). Issues with right holders (i.e. KODA in Denmark). Low royalty payments might lead to artists and record labels wanting to flee the service. Partnership with the music industry leads to an increase in credibility amongst certain (potential) customers (i.e. the Pirate Movement in Scandinavia).