Today in Tech: Why Spotify is worth "just" $3 billion

November 12, 2012: 5:30 AM ET

Also: Why Apple and HTC settled their patent fight; YouTube readies another round of convent investment. 

Why Apple and HTC settled their patent litigation [THE VERGE]

Apple's victory over Samsung is much less a predictor of future succes than you might think. Apple had essentially a perfect storm of facts in the Samsung case: the large number of Samsung devices that look exactly like Apple devices, the internal Samsung evidence showing the company directly tried to copy Apple, the massive sales of Samsung devices that could be used to calculate huge damages. Apple isn't going to get so lucky again. Especially not against HTC, which has a very different design language and comparatively tiny sales.

Where did Spotify's billion dollars go? Ask Netflix [ALLTHINGSD]

But for Spotify, you can get a bit more specific if you want a reason to pass at $4 billion: Investors already know what a digital subscription business looks like at scale.

That would be Netflix, which has some 27 million subscribers at around $8 a month. Today, after Carl Icahn goosed it a bit, Netflix has a market cap of $4.3 billion.

Spotify says it has 4 million paying subscribers at around $10 a month. Bear in mind that if you value Spotify at $4 billion today, you're really saying it will be worth three times that — $12 billion — in a few years, when it would presumably go public.

Minding the (Apple) Store [MONDAY NOTE]

'Now you know the real reason for Browett's firing', a friend said, half-seriously.'How can you spend North of $15M on such a strategically placed, symbolic store, complete with Italian stone hand-picked by Jobs himself…and give no consideration to the acoustics? It's bad for customers, it's bad for the staff, it's bad for business, and it's bad for the brand. Apple appears to be more concerned with style than with substance!'

YouTube preps big new round of content investments [AD AGE]

Google's video giant will provide a second round of funding to 30% to 40% of its original partners and will start notifying those getting more investment in the next few weeks. "Our biggest objective was to kick-start the ecosystem, to bring in great creators, to deepen our relationships with advertisers and to grow viewership," said Global Head of Content Jamie Byrne.

The problem with measuring digital influence [TECHCRUNCH]

One of the reasons that brands don't understand digital influence is because they don't seem to realize that no one actually has any measured "data" on influence (i.e. explicit data that says precisely who actually influenced who, when, where, how, etc.). All influence scores are computed from users' social activity data based on some models and algorithms of how influence works. However, anyone can create these models and algorithms. So who is right? How can we be sure your influence score is correct? In other words, how can we validate the models that vendors use to predict people's influence?

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About This Author
JP Mangalindan
JP Mangalindan
Writer, Fortune

JP Mangalindan is a San Francisco-based writer at Fortune, covering Silicon Valley. Since joining in 2010, he has written on a wide array of topics, from the turnaround of eBay to the evolution of net neutrality. A graduate of Fordham University, Mangalindan has also written for GQ, Popular Science, and Entertainment Weekly.

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