Reports Reveal Spotify’s Plans To Launch First Hardware

Reports have recently revealed that Swedish music streaming application company Spotify will be unveiling its first hardware device soon. Information has first been since in advertisements directly from the music streaming application. Since the beginning of the week, a number of the application’s users being able to hear advertisements on a Spotify produced device.

The advertisements which has then since disappeared appeared to have advertised speakers to be installed inside cars and meant to be a music player without the need to be operated by hands.

Speculations of the company building or developing a smart speaker has began more than two months ago when the company placed a job advertisement that caused the speculation.

First Move After IPO

Spotify’s move regarding putting out its very first device will be the first move of the company after it officially launched the initial public offering of its shares should the company confirm this.

Spotify which offered its shares during its IPO at a price of $132 was able to sell it by as much as $165.90 per share when Spotify’s stock traded on the New York Stock Exchange for the first time. This pushed Spotify’s market value by around $26 billion slightly exceeding expectations of the company’s value standing at around $25 billion.

Prior to Spotify’s IPO, the company faced inquiry from the public regarding their ability to give back profitability and value to their shareholders and investors as the company is known for not having a high revenue due to the massive fees it is paying music labels, producers, and songwriters which includes large companies like Sony, Warner Music, and Universal Music Group.

However, Spotify have stated that it is planning to work on negotiating with music companies regarding the fees it is paying to be able to host music on its streaming site and application.

The company is expected to raise its capital higher following the IPO in the next coming months. Spotify also has pending deals with independent labels which is set to expand its library without incurring high costs. 

Despite this, a smart speaker possibly being released by the company may expand the services being offered by the company as well as place it at par with other tech companies who have also placed their own smart speakers in the market. Smart speakers have also gained popularity over the past year. Currently, the Spotify has been integrated in a number of vehicles such as the Tesla Model S and BMW Series. A smart speaker or car speaker would appeal to car owners which would result into an increase in public preference for Spotify over other music streaming sites.

Read also: Spotify Share IPO to Send Market Value to $25 billion

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