Spotify Acquires Betty Labs to Expand Live Audio Capabilities

Spotify’s stock has experienced a slight increase following the announcement of its acquisition of Betty Labs, the creator of the live audio platform, Locker Room.

Crunchbase data indicates that Betty Labs had previously secured over $9 million in funding prior to this agreement.

Expanding Beyond Music Streaming

While primarily recognized for its music streaming service, Spotify is actively diversifying into new audio formats.

This expansion aims to establish a competitive advantage in its core market and unlock new avenues for pricing flexibility.

Investment in Podcast and Live Audio

The company has significantly invested in podcasts in recent years, securing exclusive rights to prominent shows.

By differentiating its audio offerings, Spotify intends to potentially increase subscription costs and foster future growth.

Betty Labs Integration and Future Plans

Spotify explicitly outlined its objectives for the Betty Labs acquisition on its official blog.

The company plans to “evolve and expand Locker Room” into a more comprehensive live audio experience, catering to a broader audience of creators and listeners.

Forthcoming content will encompass sports, music, and cultural programming, alongside interactive features designed to facilitate real-time creator-audience engagement.

Competition in the Live Audio Space

The new platform could be seen as a combination of radio and Clubhouse.

TechCrunch intends to evaluate the technology as it has done with similar platforms like Clubhouse and Twitter Spaces.

Clubhouse's Trajectory and Market Opportunity

Clubhouse played a key role in popularizing the current live audio trend, attracting substantial investment and initial user adoption.

However, recent data from AppAnnie suggests a stabilization in Clubhouse’s user base, potentially creating an opening for Spotify or other established audio platforms to gain market share.

Spotify's History of Audio Category Leadership

Spotify has demonstrated a pattern of entering new audio categories and achieving market dominance.

According to eMarketer data, Spotify’s U.S. podcast listenership is projected to surpass Apple Podcasts this year, reaching 28.2 million monthly users compared to Apple’s 28.0 million.

Implications for the Audio Startup Landscape

Although the acquisition wasn’t inexpensive, Spotify’s ambition to lead across all audio categories suggests that its entry into the Clubhouse-style live audio space could pose a challenge to existing startups.

Looking Ahead

The success of Spotify’s strategy hinges on its ability to leverage its widespread platform accessibility and large user base.

The outcome of this endeavor will become clearer throughout the year, but for now, Clubhouse remains accessible to iOS users.