Music-streaming service Spotify AB said Wednesday it will expand its ambitions in entertainment by offering video programming and podcasts...
The closely-held company said its online video content will include news and clips from outlets like ABC, BBC, ESPN, NBC, Comedy Central, Maker Studios and Vice Media.
In addition, Spotify said it is also introducing original content, such as “A Full English,” a show that will feature artists and other personalities who search for common ground over breakfast.
The Wall Street Journal reported on Spotify’s video plans earlier this month.
The company also unveiled a new interface meant to serve up content recommendations based on a user’s taste and mood, and a running service that adapts to a listener’s running tempo.
The moves come as Spotify is facing challenges in its core business. The company has yet to turn a profit in the streaming-music industry, where its rivals include Pandora Media Inc.,Apple Inc.’s Beats and rapper Jay Z’s Tidal. Spotify said in January that it had 60 million users going into 2015, 15 million of which were paying $9.99 a month for its ad-free premium service.
The video foray coincides with talks in which Spotify seeks to raise more than $400 million from investors in a round of funding that would value the company at more than $8.4 billion, The Wall Street Journal has reported, citing people familiar with the matter.
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Spotify has assembled a deep roster of content partners for the video service. ViacomInc.’s cable network Comedy Central will distribute clips from shows like “Broad City,” while Vice Media will feature clips from its international news reporting team. The videos will be available to both subscribers and nonsubscribers.
Spotify Chief Executive Daniel Ek said that the discussions with media companies began about two years ago, and then heated up recently. “We’ve been threading this space very carefully and thinking about our role,” he said.
Media companies will be paid upfront fees for their programming and will get a cut of the revenue when ads are eventually introduced, according to people familiar with the matter.
Mr. Ek declined to discuss terms of the deals, but said video ads will come to Spotify soon. “We are seeing that as a very important revenue source for us,” he said.
The company’s strategy appears to be different from rival video companies like YouTube that offer an enormous selection of content from all manner of creators. “We are being very selective in terms of what partners we work with and how we take them to this platform,” Mr. Ek said.
Within the Walt Disney Co. media stable, ABC is distributing clips from “ Jimmy KimmelLive,” while ESPN will provide snippets of the documentary series “30 for 30.”
The Web video company Tastemade is co-producing a pair of original series with Spotify, while also planning to deliver content from its vast YouTube library.
Steven Kydd, Tastemade’s co-founder, said the deal with Spotify happened very quickly over the past few weeks. He had yet to see the video product until today.
“As a user of the product, you can see how the personalization really works. I have to believe they are going to bring the same thoughtfulness to discovery of content as they have for music,” Mr. Kydd said.
Write to Mike Shields at mike.shields@wsj.com and Chelsey Dulaney atChelsey.Dulaney@wsj.com
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