Alphabet Inc.’s Google decided to allow Spotify Technology SA and other app developers to offer users an alternative third-party payment option alongside Google Play’s option.
KeyBanc analyst Justin Patterson saw the move as a win for digital content providers.
He viewed alternative payment options as a happy compromise that calmed regulators and large developers without sacrificing Google Play Store revenue or trust and safety.
Patterson considers this as a general positive for Spotify, an event that reduced EBITDA risk toward Match Group Inc., and a call option for Duolingo Inc.
Deutsche Bank analyst Benjamin Black sees the move reducing friction for potential new Spotify subscribers and driving incremental subscription adds given the more seamless customer onboarding experience.
Faster subscriber growth for Spotify was also positive for Warner Music Group Corp. and Universal Music Group NV.
JPMorgan called out the move as positive for Bumble Inc. and Match.
Benchmark saw the move benefitting margins.
