Will Spotify ever make money? This article says “no.”

This article says “no.” Will Spotify ever make money?
Over the last ten years, the music industry has waged a relentless war in Congress and the courts to force streaming companies to pay more for the music they play. Keep reading. Shares of the music streaming service fell over 7%, even though the company met its goals for customer and revenue growth. Actually, it’s inevitable. Spotify is the big gorilla in the streaming space with more than 70 million paying subscribers and another 70 million or so free users. Unfortunately for Spotify, Wall Street was hoping it would beat expectations à la Facebook or Google (which regularly surpass stated targets) and when it didn’t, investors sulked. Those investors better get used to disappointment. That’s because unlike other tech companies, music streaming services face a fundamental business problem they can’t overcome. That’s a big customer base, but Spotify is still losing hundreds of millions of dollars a year. And according to Fortune, the future doesn’t look good. And that supplier has both a monopoly and deep political influence to protect it. But regardless of whether such payments are justified, what matters is the music industry has the clout to demand them. Spotify announced its first quarterly results as a public company on Tuesday, and the market was not impressed. The justifications for the payments are often shaky—for instance, record labels and 1960s musicians sued Pandora over and over to pay an unprecedented royalty on pre-1972 recordings (essentially new money for old rope) until the company capitulated. How is this possible? In the case of streaming services like Spotify, they are uniquely dependent on a single supplier—the music industry—to provide them the goods for their product. That problem is the price of music or, in this context, what accountants call “cost of goods sold.” The term refers to materials a company must acquire to sell its product—for instance, the flour and sugar a baker must buy to sell donuts.