Spotify Has a Key Difference From Netflix. Does That Make It Uninvestable?

Two key reasons why Netflix (NASDAQ:NFLX) has been a killer investment over the past decade are ownership and scale. When the company owns its content (House of Cards, Stranger Things, etc.) and can offer it at scale to hundreds of millions of subscribers, it benefits. While subscribers don’t pay per view, the popularity of the shows leads to recurring revenue.

Spotify (NYSE:SPOT) is trying to do to the audio world what Netflix has done to the video-streaming world. But there’s one key difference: Spotify owes royalties when users listen to songs on the platform. Does that make the stock un-investable?

Not quite. There are lots of reasons to own Spotify stock. In this June 30th video, Motley Fool contributors Brian Feroldi and Brian Stoffel sum up their hour-long dive into the company by highlighting the bull and bear case for owning the stock.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.


View more information: https://www.fool.com/investing/2021/07/08/spotify-has-a-key-difference-from-netflix-does-tha/

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