There are new changes coming to Spotify’s ad-supported non-paying listeners. The service which has over 50 million free listeners is working on new ways to provide value to record labels, while also stimulating more people to pay.
ADVERTISEMENT
Free users will not listen to selected albums for 2 weeks after release
The result of this deal, will be a reduced experience for its free listeners, but there will be plenty of benefits for the company’s long-term financial health.
Wizkid is one of Nigeria's leading artists on Spotifiy
Recommended articles
![Reps call on military to utilise modern tech for security issues in Nigeria [ChannelsTV]](data:image/svg+xml;charset=utf8,%3Csvg%20xmlns%3D'http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg'%20width%3D'100'%20height%3D'100'%20data-ring-placeholder%3D'1'%3E%3C%2Fsvg%3E "Reps call on military to utilise modern tech for security issues in Nigeria [ChannelsTV]")
While the aim of the company is to make all music available, plans are being formulated to change that, as the company is getting ready to float its IPO and negotiate better royalty rates with major labels. One of such measures is to withhold new projects from listeners for a window of two weeks. And according to reports, it is seen as a game changer.
Spotify has confirmed that it has struck a deal with Universal Music Group to pay the label less money for streams, but only allow new releases by the label to be streamed by paying listeners who are on Spotify Premium accounts for up to two weeks. This means that ad-supported listeners will have to wait for those two weeks.
"This partnership is built on a mutual love of music, creating value for artists and delivering for fans."A statement from the company says. "We will be working together to help break new artists and connect new and established artists with a broadening universe of fans in ways that will wow them both."
ADVERTISEMENT
The deal is the first of its kind but it will not be exclusive to only Universal Music artists. There are multiple reports which state that similar talks are being held with Sony Music Entertainment, and Warner.
TechCrunch reported in February that Spotify would seek to renegotiate its licensing deals to pave the way for a 2018 IPO. Similar windowing deals with other labels could follow.
Spotify is the only top-tier music streaming service that offers an on-demand free tier, which is great for users who won’t pay $10 per month, and serves as an effective funnel getting people hooked until they do pay to ditch ads and restrictions. Spotify's competitors Apple Music and Tidal do not offer free streaming whatsoever.
Spotify is also the only leading on-demand streaming app that is solely a music company. Apple, Google and Amazon all make money in other ways and just offer music as a complementary service. Meanwhile, Spotify depends solely on its royalty rates.
Spotify is not available in Nigeria and many other African countries, although there are unconfirmed reports that it is considering a move into the continent. It’s competitors, Apple Music, Deezer and a few others already operate on the continent.
ADVERTISEMENT
In previous years, copyright enforcement is more difficult in countries in Africa that don't have solid Intellectual Property laws, like those in Europe, the Americas and the rest of the developed world.
Rather than have streaming content available in those countries, which would mean enforcement of laws in the event of piracy, streaming content providers such as Spotify, Pandora and the likes prefer to stay away.
But there have been improvements sweeping across the continent. In Nigeria, development of systems to fast-track the total enforcement of IP Laws are underway, with relative progress seen.
Nigerian artists continue to utilize the service to distribute their music internationally. and generate revenue. Korede Bello on Spotify, and Wizkid's contribution to Drake's 'One Dance', earned him over 1 billion streams on the platform.
JOIN OUR PULSE COMMUNITY!
ADVERTISEMENT
Eyewitness? Submit your stories now via social or:
Email: eyewitness@pulse.ng
Next story
ADVERTISEMENT
