The Nordic audio market is highly interesting for several reasons. Overall conditions are favourable, with a combination of high-profile services of Nordic origin and a large, digitally mature, consumer base. Scale is the name of the game, and tomorrow Spotify which is by far the largest actor in this segment, will release its Q3 financial report.

Spotify is, no doubt, a world class leader on the audio market. With 138 million premium subscribers globally (end of Q2) and an impressive 27% growth YOY, expectations are high as we approach the earnings report. However, subscriber growth is not the only point of interest in tomorrow’s report. Another highly interesting area is podcasting. Spotify has invested heavily in podcasts lately, for several reasons. Podcast content allows the company to differentiate vis-à-vis competitors to a larger extent than music allows, and also enables the actor to obtain higher margins than for music content. Spotify has also stated that users with ad-supported accounts that listen to podcasts are more likely to convert to a paid account. In Q2, Spotify reported a triple digit growth in podcast consumption, indicating that the investments are paying off – at least in terms of listening.

The Nordics are, for sure, Spotify’s home turf. Looking at the latest Mediavision analysis, close to 4 million Nordic households had access to a paid Spotify subscription (i.e. not an ad-supported free account) in Q3 2020. This corresponds to a 34% household penetration for subscriptions (non-advertising supported) – surely dwarfing competition – a relatively stable penetration YOY when compared to Spotify’s global subscriber growth. In other words, the Nordics is a mature market for Spotify – which is also reflected in how well their Nordic user base has adopted podcast listening.

In the Nordics, the average daily reach for podcast listening is 16% – an increase of 13% since Q3 2019. Spotify is the listening platform with the highest daily reach. Competition comes from commercial radio, public service radio and – of course – from Apple. In other words, on a rather fragmented market, Spotify has a strong position, and it seems as if Spotify’s “audio-first”-strategy has successfully been implemented across the Nordics.

But competition is expected to increase – perhaps most clearly illustrated by a possible launch of Amazon Prime in Sweden. When Amazon.se launched in Sweden this morning (Wednesday), the Prime solution was not available to Swedish consumers. As of now, Amazon Music is a very small player in the Swedish market. However, if Amazon Prime Memberships would be available in Sweden, and Music was to be included in at no extra charge, things could change rapidly. The company has also announced free podcasts on Amazon Music. Another challenger is of course Apple Podcasts, reportedly looking to invest in exclusive podcasts. Could a paid podcast service from Apple possibly be a future part of the Apple One bundle – and will Apple One be made available in the Nordics? The transformation of the Nordic market is here and now – and Mediavision tracks the developments closely and with great interest.

Industry Events

Medientage: 28-30 October 2020, Munich, Germany
American Film Market (AFM): 4-11 November 2020, Santa Monica, USA
NEM: 9-11 December 2020, Zagreb, Croatia
MWC Shanghai: 23-25 February 2021, Shanghai, China
MWC Barcelona: 28 June – 1 July 2021, Barcelona, Spain

*Mediavision will attend
**Mediavision will present