News - 12/09/2017

Deezer may revisit IPO after Spotify goes public

Deezer may revisit IPO after Spotify goes public

Deezer's last attempt to go public was abandoned shortly after the company published its prospectus. It seems the experience hasn't put the streaming service off an IPO in the future though.

In a profile of Deezer, Reuters paraphrased its CEO Hans-Holger Albrecht as suggesting that if Spotify's flotation is successful, Deezer could also consider going public. The piece also outlines Deezer's ongoing strategy of doubling down on local content, from gospel in Brazil to reggaeton in Puerto Rico. The company is also planning to focus more energy on markets where Spotify is not yet big: Guatemala, Bolivia, Paraguay, Colombia, Nigeria, Senegal and South Africa included.

"While Spotify is mainly playlist-focused, we are betting on local differentiation", said Albrecht, adding that Deezer sees plenty more room for growth. "Streaming is a very young market, with just about 10 percent penetration globally, so there is a lot of potential still".

Stats in the piece include the fact that Deezer users listen to an average of 30-60 hours of music a month – "a seven-fold increase from two years ago" – as well as Albrecht claiming that in France, Deezer now has 'double-digit profit margins'. Globally, the company's annual revenues stand at $360m, with losses of $60m. It also seems that Deezer hasn't yet given up on a potential acquisition of SoundCloud, with Albrecht suggesting such a deal remains attractive "at the right price".

Source: Reuters – http://tinyurl.com/y8nncehep

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