Spotify generates the majority of revenue from advertising and subscriptions, but for the past few years, the music-breaking giant has also quietly built the developer touring business. Backstage is an open source project in 2020 and has been adopted by over 2 million developers in 3,400 organizations, including Airbnb, LinkedIn, Twilio and American Airlines.
Backstage helps businesses build customized “Internal Developer Portals” (IDPs), bringing infrastructure disruption by combining all their tools, apps, data, services, APIs and documents into a single interface.
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The Cloud Native Computing Foundation (CNCF), which accepted Backstage as an incubation project in 2022, reports that Backstage was one of the top five projects in terms of speed and activity last year. And it’s this momentum that doubled Spotify, with a range of premium tools and services on the horizon.
Oven bake
Companies can use core backstage products for free, including a set of open source plugins that extend functionality. However, Spotify began selling premium plugins in 2022, including backstage insights that display data related to active backstage use within your organization. And last year, Spotify took seriously the business play of its development tools and unveiled the beta backstage Spotify Portal. This is a premium oven baked incarnation for those who lack resources (or tilt). “Behind the scenes in the box” is a common idea.
The fully managed SaaS product is bordered towards general availability in the coming months, and is already equipped with design partners and customers, including Linux Foundation and Pager Duty.
“We discovered there are a lot of different customer profiles,” Tyson Singer, head of technology and platforms at Spotify, explained to TechCrunch in an interview with Kubecon last month. “Our first theory was that it would be bigger for medium to large companies, dealing with a lot of complexity behind the scenes, but we found that small and medium-sized businesses are also looking at these same issues.
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Spotify has messed around with some new premium portal plugins from Kubecon, including Aika (“AI Knowledge Assistant”). This is essentially the chatbot originally developed for its own employees.
As a result of the 2023 hackathon, Spotify says Aika is currently using 25% of the workforce weekly to refer to the company’s collective knowledge base. So, rather than firing support channels in Slack, employees can ask Aika. It is trained with its own internal documents and data.
Singer also motivates employees to make sure all documents are up to date, in order to make Aika smarter. If someone doesn’t answer the question properly, they can check the source used in the response and provide feedback to improve the source document.
“It (Aika) sounds simple, but it’s powerful and we were adopted internally very quickly,” Singer said. “(I think) it’s not just the developers who use it. Everyone in the R&D organization falls into it, drawing more people into the behind-the-scenes ecosystem.
Spotify has confirmed that the ALPHA version of AIKA is set to launch imminently for third parties. And while it will not initially be functional parity with its own internal version, it should move towards enhancing backstage stickiness as a premium product in the long run.
Increased confidence
Behind the scenes, homemade developer product Spotify is not the only one that is aiming to monetize. About 20 months ago, the company announced its confidence. Confidence is an A/B experimental platform that has been in stealth ever since.
“We have a few customers who are paying (for confidence), but now we’re really focused on the portal,” Singer said. “We are very selective about customers who put the door in.”
Spotify details confidence later this year, according to Singer, but he suggested a potential synergy between confidence and the portal in the form of plugins that bring simple functional diffusion capabilities to the portal.
When everything was said and done, creating a developer’s Touring Side Hustle, along with his job as an online music emporium, was certainly a big effort. But all of this had good reasons. More than a decade ago, Spotify created its own container orchestration platform called Helios to support the migration to the Microservices architecture. Spotify eventually opened Sourced Helios to encourage wider consumption, but ultimately lost to Google’s Kubernetes and conquered the world.
Spotify abandoned Helios and joined the Kubernetes crowd. And what I’m seeing right now behind the scenes is how I respond to it. Behind the scenes, it is an industry standard IDP, an effort to ensure that your own developers are forced to move to something else.
“If you have an external product, especially an open source product, the transition costs are incredible,” Singer said. “So we decided we didn’t want it to happen to a product that was literally the basis for how it’s developed on Spotify.”
Spotify was going in some way to avoid that issue when it was open sourced behind the scenes in 2020, but the ongoing premium one is to ensure it sticks.
“We’re a business, and we want to build a healthy business on top of this,” Singer said. “We’re not just trying to cover costs. At the end of the day, there’s a lot of value trapped inside Spotify right now.”