A Spotify video service may soon be a reality if there's any weight to the latest reports making the rounds.
The Wall Street Journal is reporting that Spotify is now trying to get a video service off the ground. Mike Shields and Jens Hansegard write:
Music streaming service Spotify is laying plans to enter the hotly competitive Web video business and has been in discussions with several digital media players about potential partnerships, according to people familiar with the matter.
The closely-held streaming service, which has shaken up the recording industry over the past few years, has been reaching out to companies that specialize in making content for YouTube to discuss both acquiring their material and co-creating original video series, said people familiar with the matter. Spotify has also reached out to some well-known traditional media companies.
Rumors of a Spotify video service are nothing new. There were reports at least as far back as early 2013 about such a plan. Those reports had the company taking on Netflix and HBO with high quality original content.
There is certainly a great deal of opportunity in video advertising these days, which Spotify does already offer. It introduced video ads in September:
"Spotify Free users can watch a brand-sponsored video spot (aka a Sponsored Session) in exchange for 30 minutes of uninterrupted music," the company explained. "Brands can also sponsor a video ad break on desktop with a Video Takeover. Both formats are delivered in a 100% viewable environment and give our brand partners 100% share of voice."
“Our audience is incredibly engaged so we are delivering an advertising experience that enhances their time spent on Spotify and connects them to the music and brands they love,” added Jeff Levick, Spotify’s Chief Business Officer.
A recent study from Advertiser Perceptions and the Interactive Advertising Bureau (IAB) found that 68% of marketers and agency execs expect their digital video ad budgets to increase over the course of the next year.
The study was conducted based on a survey of 305 buy-side professionals, who largely expect that greater investment in digital video will come from overall rising ad budgets this year and as funds shift away from broadcast and cable TV. 67% said they anticipate their broadcast and cable TV ad spend to stay the same or decrease in the next year.
67% also believe that original digital video will become as important as original TV programming within the next 3 to 5 years.
“This study demonstrates unequivocally that digital video is a fierce competitor for advertising dollars,” said Sherrill Mane, SVP, Research, Analytics, and Measurement at the IAB.
Spotfiy, which has benefited from a great deal of Facebook exposure over the years may find to break into that same kind of visibility with a potential video product. Facebook is already advising page admins against posting videos from third-party services in favor of promoting its own native videos, which are drawing a great deal of those ad dollars.
Last month, Spotify began letting brands tailor ads based on mood with playlist targeting.
Image via Spotify