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Spotify Chief Content Officer Stefan Blom Exits

Stefan Blom, Spotify’s chief content officer, is leaving the company after a little more than three years — and just as the music-streaming provider is about to launch an initial public offering.

In a statement, a company rep said, “We are grateful for Stefan’s many contributions to the company over the years and we wish the very best. Looking ahead, the content team is well positioned to execute on our strategy.”

The news, announced in a memo to Spotify staff Friday and confirmed to Variety, was first reported by Recode.

Blom, who reported to Spotify co-founder and CEO Daniel Ek, led the company’s renewal in 2017 of its licensing deals with all three major music labels as well as the independent-label collective Merlin. The company has not yet named a replacement.

While a source close to the situation told Variety that the parting is amicable, “If I had to guess, I think he was pushed out,” said Santosh Rao, head of research at Manhattan Venture Partners, who has been covering Spotify for several years. He points to the company’s largely unsuccessful move into video, which was announced as a growth area with great fanfare when former VH1 chief Tom Calderone joined as Spotify’s head of content partnerships in March 2016; he left just 15 months later after its original video shows, including the Russell Simmons-produced “Traffic Jams,” failed to catch on.

“The video platform that he was supposed to develop hadn’t taken off, so maybe he’s being replaced by someone else the CEO has in mind [as a way of managing the optics of that sore point],” Rao said. “Or, it’s also possible he didn’t want the company to go public yet and wanted to develop more and then go out. But it’s how the company manages the narrative that matters, and it might be a positive: They might say ‘We needed to enhance the video platform’ and then announce some big new hire. So I think they can spin it very well, but they need to — it reflects some turmoil shortly before they go public, and the optics are not very good.”

It seems unlikely that Blom’s departure was solely a result of the $1.6 billion lawsuit recently filed against the company by Wixen Music Publishing, which alleges that Spotify is using its titles without a proper license. “I just see that as a continuation of an ongoing battle with publishers, and lawsuits in copyright and intellectual property are par for the course,” Rao said. “Obviously it’s in Spotify’s best interest to settle that amicably before the IPO.”

Prior to joining Spotify in September 2014 as chief strategy officer, Blom was a senior exec at EMI Music, most recently serving as chairman and CEO of the group’s Nordic division. Before joining EMI in 2007, he was head of products and services at telecom operator 3 Scandinavia.

Earlier this week came word that Spotify filed for its long-expected IPO in a confidential F-1 filing with the SEC. The Sweden-based company is expected to launch an IPO as early as the first quarter of 2018 as a direct listing on the New York Stock Exchange rather than a traditional offering of shares. That’s designed to make it easier for the company to go public — it would not dilute the current equity holdings of executives and investors, and Spotify would avoid paying underwriter fees — but also means it won’t raise capital with the IPO.

Meanwhile, on Thursday, the company announced that it has passed 70 million paying subscribers, an increase of 40% in less than a year (it reported 50 million in March 2017). Spotify’s closest competitor, Apple Music, reported 30 million subscribers in September.

Spotify’s valuation as of December 2017 exceeded $19 billion, up from $16 billion earlier in the fall, Reuters reported last month. However, the company has not turned a profit and reported an operating loss of $389 million in 2016.

Earlier last month, Spotify agreed to buy a stake in China’s Tencent Music Entertainment, which in turn will purchase an equity stake in Spotify; the terms of that deal weren’t disclosed.

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