“After I left Facebook and became an investor, I started looking at every single music service out there,” said Sean Parker today.
It was a side comment, made at the Spotify event in New York, as he shared a stage with long-time adversary, Lars Ulrich from Metallica. The two announced that the band’s music was finally coming to the platform. (More on that here.)
But it’s a very revealing side comment and reminds us that Facebook, even when it was still a fledgling college-only social network (much smaller than the 1 billion users it is today), already had people behind it with much bigger ideas of where it would eventually go. It seems that one of those places was in building a music service of its own.
This was something that Facebook was considering as far back as 2008.
“We believe, based on discussions with a number of sources, that Buzznet, iLike, iMeem, LaLa, Last.fm, Rhapsody and other services were contacted and provided with a document (sometimes referred to by sources as an RFP (request for proposal), other times called a term sheet) that outlined certain goals of the new Facebook music service,” Mike Arrington wrote here. He speculated that this was partly fueled by MySpace: Music was the one thing that MySpace was offering users that Facebook was not.
As it turned out, MySpace imploded on its own, and labels didn’t really want to make music with Facebook. And, perhaps, nothing was good enough for Parker, who had cut his teeth in the music business with Napster.
Nothing, that is, until he saw Spotify.
“This company knew that product and experience dictate the design,” Parker said about his first impression of Spotify. “They were stubborn in a good way and got the deals that enabled Spotify to be a success in the first place.”
That was what led him to invest in the service, and it almost certainly played a role in how Spotify eventually became one of the first music companies to integrate its streaming service with Facebook’s open graph — and the only one that was allowed on stage with Facebook to show off how well it worked when it was launched in 2011.
Spotify’s Facebook association has been a big part of how well the company has grown in the U.S., where, it revealed today, it now has 1 million paying users. The company also reported a wider global user base of 5 million paying users, and 20 million users overall.
Yes, today’s launch of a discovery platform, complete with the ability to follow influencers and artists — along with the ability for musicians to push music directly to their fans — interconnects with Facebook, Twitter, and (for good measure) Tumblr.
But today Spotify also seemed to carve out a stronger place for itself, more than ever before, as a platform of its own. That gives it some distance from Facebook.
As Facebook looks for more ways of engaging its users, and developing new revenue streams, will that journey take it back to a replay of its old music strategy?
Facebook is the world’s largest social network, with over 1 billion monthly active users. Facebook was founded by Mark Zuckerberg in February 2004, initially as an exclusive network for Harvard students. It was a huge hit: in 2 weeks, half of the schools in the Boston area began demanding a Facebook network. Zuckerberg immediately recruited his friends Dustin Moskovitz, Chris Hughes, and Eduardo Saverin to help build Facebook, and within four months, Facebook added 30 more college networks. The original...
Spotify has created a lightweight software application that allows instant listening to specific tracks or albums with virtually no buffering delay. It was launched in the fall of 2008 and had approximately 10 million users by September 2010. Spotify offers streaming music from major and independent record labels including Sony, EMI, Warner Music Group, and Universal. Users download Spotify and then log onto their service enabling the on-demand streaming of music. Music can be browsed by artist, album, record...
Sean Parker is a serial entrepreneur and a managing partner at the Founders Fund. As one of the three founders of Napster, Sean helped architect and manage the peer-to-peer file sharing application to become one of the largest on the net. Parker subsequently helped found and manage Plaxo, a VC-backed contact management application company. More recently, Parker worked as the Founding President of Facebook before moving on to join up with Peter Thiel at The Founders Fund,...