What can digital publishers learn from Spotify and Netflix

What can digital publishers learn from Spotify and Netflix

What do Spotify and Netflix have that newspapers don’t have? Exponential growth of (digital) subscribers for one. Digital publishing has been looking at those two streaming superstars for inspiration for a while now. Let’s take a look at if and what can publishers really learn from the streaming business.

Obviously music and video streaming is principally different from publishing journalistic content - both by business model and its social role. It’s socially vital that we have accessible, reliable and objective press. It’s not that vital if and how we can access the latest hits or binge on the recent hit show.

As it comes to the business model, it’s not directly adaptable to publishing. Netflix’s has become the synonym to binge watching and its success is based on four factors: creating original content, offering external high quality content, affordable pricing and accessibility anywhere from any device.

In February 2019 Spotify announced acquiring two podcasting companies. Other than that, they don’t create their own content. Spotify gets content from major record labels as well as independent artists, and pays copyright holders royalties for streamed music. Their business model is based on freemiums and subscriptions are their main revenue source. They encourage people to pay for music, as subscriptions remove advertisements and limits.

Obviously offering external content can’t work for a single publication and a cross publishers platform would threaten the publishers’ revenue even more. Apple’s plan to release a subscription news service caused an uproar with asking the publishers to give the company 50 percent of any revenues that they generate. It raised questions about big tech getting too powerful and the future of free press altogether.

Of course there are parts of their success that the publishing industry can and should replicate. Here are five points to consider from Spotify and Netflix’s success.

1. Solve your readers’ problems, not your own.

Big part of Netflix’s success is linked to their willingness to cannibalize their own business model. Its founders have had the ability to look as an outsider at their business model and see where the market is heading in the next decade. Netflix is constantly looking for ways to solve problems for many customers.

Constantly changing and evolving your business model is definitely not comfortable but in the case of Netflix, it’s been incredibly rewarding. Game changing times need bold and courageous decisions. Publishing should also analyze their value propositions and really think about the readers’ wants and needs. How can your content, form or payment model serve the reader better.

2. Really get to know your user (reader).

Both Spotify and Netflix have powerful algorithms that help them gain an insight into their customers’ preferences. They know exactly what customers want, when they want it and on what device. Netflix also creates their shows based on the analysis of their own customer data.

Yet again, it’s not that black and white in case of journalism, since at least some part of it shouldn’t be too personalized. Exposure to different opinions is necessary for the functioning of society. But research on the echo chambers and filter bubbles has revealed that people actually read lots of media - they consume five different sources on average and encounter diverse opinions there. In that light serving interesting and relevant content to your specific reader doesn’t necessarily mean coddling them with one-sided views of the world.

Also the content that people are willing to pay for, isn’t necessarily the same content that drives huge traffic. Wired’s experience with setting up a paywall shows that relatively small traffic can bring impressive amounts of subscribers, if the topic is relevant enough. This might work for publications with a really high brand value and a core group of loyal readers.

3. Make personalized package offers (or better yet, let the reader combine their own package).

Industry experts bring out that different media companies both in journalism and across different formats should consider cooperation between themselves. Consumers don’t want to limit themselves with just one media brand. The answer might be combining different competing media publications into one fixed price package. Bigger media groups can offer combined packages of their own different publications - or even let the client mix and match their own. For example someone might want to read one daily paper, 3 articles from a household magazine and get access to the cycling section of a sports magazine. The reader probably wouldn’t pay for the whole subscription to access only small pieces, but they would be willing to pay extra for content that’s really relevant to them.

Niche offers and channels are popping up left and right in the streaming business - you have dedicated channels for anime, e-sports or even classic British TV. Smaller streaming services see it as the opportunity to cater for very specific audiences who are also likely more committed and stickier.

4. Focus on high quality content.

Netflix spends more on original content than rivals and keeps beating them in customer satisfaction surveys. It shows that investing in high quality original content pays off.

Publishing experts note that just broadcasting news doesn’t cut it any more. The readers don’t want mere info and you can mostly cash in on added value, which can be found in investigative journalism. It is especially important to keep a constant level of quality because if a customer is disappointed once, the next time they’re not willing to pay for content.

5. New business models might take time to become profitable.

Spotify finally become profitable just this year. That’s right, it took them 13 years and 96 million paid subscribers to finally start making money. Reinventing the publishing business might also take some time and the transfer from profitable print journalism to profitable digital journalism will probably cause some growth pains, but other segments have had them, too. You should look at those struggles for inspiration and hope.

The future of publishing asks courageous decisions from today’s industry. They need to be willing to challenge the status quo and test anything from business models to prices to payment methods. Thankfully, if your current approach isn't working, trying a new approach can't make things any worse.

Attending NOAH Berlin 2019? Let's meet up!

Attending NOAH Berlin 2019? Let's meet up!

This week, Fortumo will be headed to the NOAH Conference in Berlin. If you are attending the event, get in touch and let’s set up a meeting.

NOAH is an event focused on digital growth. Telco partnerships are one way to achieve this growth. Companies from both traditional sectors such as transportation, classifieds and publishing, but also newer sectors such as or game development, streaming and social networking are using these partnerships to drive user acquisition, payments and loyalty.

If you’re interested in learning how Fortumo can help you with these goals, reach out and let’s find a time to chat in Berlin.

Making transportation more accessible through telco partnerships

Making transportation more accessible through telco partnerships

Nowadays, mobile phones are the lifeline of our society. Having a constant connection and access to different services has already revolutionized many fields and service delivery processes. The public transportation sector is not an exception - mobile solutions offer a single channel for transport providers to connect with their customers.

This promises to change the overall travelling experience. Travellers could access real-time information, maps, timetables, share opinions and pay for their trips, but it also changes the way of how providers manage their resources. Uncomfortable systems alienate customers and neither the companies or our growing cities can afford that.

This white paper focuses on the transportation sector and their challenge of matching the users’ actual needs. Be it scooter/bike rental, taxi, carshare, metro, train, bus or even highway tolls - they’re all part of a larger transportation system that functions as a whole.

We explain how telco partnerships are an organic match for all transportation providers. It helps build seamless payment solutions and generate growth in both the number of customers and revenue.

We also refer to our case study with EasyPark, who is able to offer an easily accessible payment method to more drivers, as well as expand into new countries with no additional development.

Download the white paper immediately by filling out the form below.

May in the digital ecosystem: overview of the biggest industry stories

May in the digital ecosystem: overview of the biggest industry stories

Other than Uber’s IPO, Google’s I/O and Apple’s WWDC, what else took place over the past month? For one thing, we published our latest market report profiling carrier billing in Latin America. For everything else, check out the summary below.

General mobile


Digital publishing




Survey: what do industry analysts think of the future of bundling?

Survey: what do industry analysts think of the future of bundling?

Fortumo frequently engages with approximately 60 industry analysts who research payments, carrier billing and innovation in the digital ecosystem. We share our insights and data with them, and they give the same back. Last week, we ran a short survey among our contacts, asking them about the future of bundling.

30 of them had time to get back to us and here are the results.

What digital segments have the most potential for telco bundle partnerships?

Music and video streaming services are today the most widely bundled products with telcos. But thinking ahead a couple of years, this segment will reach a saturation point. The majority of subscribers will either have activated their streaming offers, or the content proposition has not been valuable to them. So where should telcos look next? We gave analysts the following options to consider for the future of bundling:

  • None, people are only interested in streaming

  • Games (e.g. free games or in-game content)

  • Newspapers, magazines & e-books (e.g. free subscriptions)

  • Microfinance (e.g. discounted insurance)

  • Transportation (e.g. free taxi rides or bus passes)

  • Social networks (e.g. free sticker packs or premium dating services)

  • Software (e.g. word processing, anti-viruses or cloud hosting services)

None of the analysts surveyed thought streaming would remain the only category of bundled content for telcos. Among the other segments, here’s how the breakdown looked like:

The dominance of gaming (26 respondents) is no surprise, as an estimated 2.4 billion people (32% of the global population) will be playing games this year, thanks to mobile gaming becoming widely accessible due to cheap mobile data and smartphones.

But what’s the potential in other segments? Here’s how we see the collaboration with telcos could happen, ranked from biggest to lowest potential:

  • Microfinance (19): in case of microfinance, the best match is in insurance services (which are essentially a subscription service); among others, insurance could be bundled for the phone itself, other personal assets and healthcare
  • Transportation (14): telcos can seek out partnerships with public transportation companies for free monthly passes to metro, bus and train rides; there is also the opportunity of working with ridesharing companies to offer free ride credits to users
  • Newspapers (13): digital publications are quite similar to streaming services in terms of how they are consumed; audiovisual content produced by publishers (audiobooks, video and audio news stories) also supports telcos’ goal of increasing mobile data usage
  • Social networks (9): the main opportunity would be to hand out free sticker packs and subscription access on networks where it’s available; zero-rating data for networks where (video) calls are supported can be another direction
  • Software (6): based on the number of analyst responses, this segment doesn’t look to be too exciting; however, productivity tools (such as office software, anti-viruses and cloud hosting software) could be considered by telcos for their corporate customers

Telcos’ approach to bundling needs to be scalable

In the next few years, telcos will likely see the need and opportunity to bring aboard additional digital content segments. We don’t know what the next big category for bundling will be. But the first-mover advantage will be for telcos who have built their bundling infrastructure in a flexible manner, accounting for needs of many different digital segments.

Our own Trident Bundling Platform is also built this way: it doesn’t matter what kind of digital content is bundled and whether it’s for telco-merchant or merchant-merchant partnerships. Get in touch if you want to find out more about how we can support you in getting bundle partnerships off the ground.

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