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Sean Parker 's Email to Spotify's Daniel Ek




----- Original Message -----From: Sean Parker To: Daniel Ek; Shakil KhanSent: Tue Aug 25 13:49:35 2009Subject: thoughtsDaniel/Shakil,I've been playing around with Spotify. You've built an amazing experience.As you saw, Zuck really likes it too. I've been trying to get him to understand yourmodel for awhile now but I think he just needed to see it for himself.Facebook has been in partnership discussions with various companies to fullyintegrate music download with the Facebook profile. Most of these deals would haveresulted in the wrong user experience and I've done my best to stop them wherethey didn't make sense. In particular, there's no way that iTunes could enable theright experience on Facebook. Business development teams have a bias for workingwith the top player in a given market, especially when they don't understand thatmarket. Unfortunately, partnering with iTunes would not only have created thewrong user experience, it would have had disastrous consequences for theemerging digital music industry.I'm looking forward to meeting you guys sometime in early September, though I'mpretty excited about what you've done and I can't resist sharing some of mythoughts with you here first. Your design is clean, elegant, tight, and fast. While it's clearly lacking someimportant features (the social stuff you alluded to, etc), I think you've done a great job with sequencing. You nailed the core experience around which everything elsecan later be built.Ever since Napster I've dreamt of building a product similar to Spotify. I might havetried had I not been "side tracked" with Plaxo, Facebook, Founders Fund, etc. To befair, I had very little desire to work with the record labels too soon after mysomewhat unpleasant experience with them the first time around. (Though sincethen, curiously, I've become close friends with many of the folks who were oncetrying to destroy me…)So rather than dive in again, I adopted a "watch and wait" philosophy, hoping thatthe labels would either (1) come to their senses and try something new, or (b)forced to the brink of extinction, hire new management opening the door to radicalnew ideas. Since then, the reality of Napster, Kazaa, and all the decentralized P2Pclients has sunk in and the overall industry has shrunk by more than half.What's clear is that the labels never quite understood the way people reallyconsume/share/experience digital music. And they couldn't admit to themselvesthat this behavior pattern wasn't changing anytime soon. Rather, to create the rightexperience, the business terms of their standard licensing deals would need tochange.

And change they have (in subtle but important ways) to enable the user experiencethat you've created with Spotify. Perhaps it was wishful thinking to believe thatthese deals could have been implemented in the US first…so I'm not surprised thatthe Spotify "experiment" had to be conducted elsewhere.I do wish I'd reached out to you guys before your most recent financing. I evaluatedevery other player in the market but was only able to use Spotify through a low-bandwidth proxy service which never quite worked right. At that time, I wasn'taware that your licenses were somewhat different from what I'd seen in the past.So as you can tell I'm pretty excited about what you've built…I've waited nearly a decade for a product that could match the standard set byNapster on three counts:(1) convenience(2) speed/responsiveness(3) sampling/discovery of musicFor obvious reasons, none of the decentralized P2P products (Kazaa, etc) could everapproach the usability of Napster. The subscription products were doomed to fail onall counts due to annoying DRM, poor integration with the portable devices, andhigh barriers to entry. The pay-per-download products (iTunes, etc) still don't takeinto account the way people really consume music: they have priced themselvesout of the market and until very recently none of the products (except iTunes) couldpush music to the iPod due to Apple's restrictions on AAC coupled with the labelsrefusal to sell unprotected files. Last but not least (for some utterly inexplicablereason) all of these products have lacked the basic usability (speed/responsiveness)that the world came to expect from Napster!So we find ourselves in an odd place. The iPod monopoly has effectively stifledinnovation in the market. The investor bias towards web applications over desktopapplications has lead to a broken user experience and poor implementation of streaming music solutions. You guys have changed all that. You've distilled the product down to its coreessence and implemented the right basic set of features. As product designers wecan never have exactly what we want, when we want it. We have to start byunderstanding the really important parts and building that core functionality first,then building additional features around that core. When you're building consumerproducts, getting serious leverage in the marketplace (distribution) is the mostimportant first order goal, so you need to accomplish this as quickly as possible andthen shift gears to build second generation features. You guys nailed the core experience: it's at least as good as Napster for search andlistening, and everything else can be built from there. Even though it's not adownload service, it has all the advantages of Napster for two reasons:(1) streaming -- widespread consumer broadband has made high-quality streamingpossible, and(2) playlists -- quick and easy storing of songs in playlists which allows Spotify to act

as a great front-end to your virtual music collection. My goal for the secondgeneration Napster (once we'd gotten around to cleaning up the messy interface)was to implement social/sharing features. This would have dramatically increasedthe volume of sharing happening through the system.Based on the comment you made to Zuck, I suspect that you're moving in thisdirection. You should build this capability directly into the client, using Facebookconnect to authenticate and then leveraging the viral communication channels tospread Spotify rapidly across the world. You guys are likely going to be the first major success story with Facebook connect.If you need some help navigating Facebook platform, in particular the viralchannels, then I'm happy to lend a hand. One of the companies I run, "Causes" isthe #1 app on Facebook with over 84 million users, and 25 million active per month. This is achieved through pure virality.Direct integration with Facebook is a good idea too but this should happen via anexclusive partnership and you should wait until you have more leverage in themarketplace otherwise the economics won't be very favorable to you. (I can helpyou with this on many levels… Zuck and I have been talking about what thispartnership should look like… as I mentioned we've already passed on iTunes, LaLa,etc.)My plan for Napster was to build a fully social music discovery and browsingproduct. Every user could share their entire music collection as well as playlists,favorite songs, featured songs, most played lists, "now playing (live)", etc. allsearchable and sortable. This is all sort of obvious, so I'm sure this stuff is already inyour product plan somewhere…At Napster, I never got a chance to implement any of these really interesting secondgeneration social features. We were stuck with our rudimentary first generationproduct. The interface we built was "utilitarian" -- and that's putting it nicely. It wasan atrociously ugly beast of a product that served its limited purpose just wellenough to be serviceable. We had every intention of cleaning it up, developing nextgen social features, and implementing advanced P2P technologies (striping, auto-selection of source, etc), but we never got around to it because of the demandsimposed upon us by the lawsuit.We released the first version of the client in 1999 and shut the service down a fewyears later. In that time we never released any significant feature upgrades -- weonly removed and crippled existing features in order to comply with esotericrequirements under the DMCA.Napster was my first attempt at building a company, and one of my early attemptsat building a usable product. While I'm proud of the impact we had, I'm notparticularly proud of the interface we built, nor of the design/aesthetics of theproduct. You have surpassed the product experience we built at Napster in all of these ways.

Napster set the bar for a successful digital music service in terms of speed,convenience, catalog, immediate gratification, etc. Until now, no digital musicservice has met, let alone exceeded the bar set by Napster.In order to create the next revolution in digital music I believe that you must BOTHmeet and exceed the bar set by Napster a decade ago. You guys have finally done it.Since this email is getting a bit long, I'll leave you with a one more thought and anoffer of assistance.Final thought: I'm glad that you guys resisted the temptation to build a web basedapp. I remain a strong believer in the desktop client approach in music for a numberof reasons.1. Speed/responsiveness of interface, and optimized downloading and streaming2. Bandwidth savings of P2P architecture3. Easy integration with hardware devices such as the iPod (ultimately you want tocontrol the interface to the portable devices where you can monetize moreeffectively by charging for download…)4. There are vast repositories of "grey" content on people's computers across theworld. This content is often forgotten by the labels and publishers. The fact that youhave a client and P2P capability will allow you to someday unlock all of thiscontent…this goes way beyond the master music catalog that is licensed to you bythe labels. A big part of Napster was the joy of discovering various remixes, liverecordings and other obscurities that copyright owners have literally lost track of.5. While you could have built a "thin" client that runs in the background and powersweb based streaming, why go to all the trouble of building and distributing clientsoftware when you could build the real experience? There is tremendous value incontrolling the client software real estate and it allows for a much snappierexperience. That's all for now. Congratulations on everything you've achieved.Let me know how I can be helpful to you with Facebook, platform, viral optimization,investment, etc. I'm eager to participate in all of these ways and more. You shouldconsider me both a fan and supporter of yours!Best, sp


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