After months of whining that exclusive music deals hurt fans, Spotify is partnering with the Universal Music Group to do, well, exactly that.
The new deal between the music giants allows some UMG artists to place their albums exclusively on Spotify’s premium tier for 2 weeks before everyone else hears it.
And if you’re one of Spotify’s 50m freeloaders who thinks “it’s just 2 weeks, big whoop”, then consider this: today would be the first time you’d be hearing Drake’s More Life.
(Plus you’d have gone 14 painful days of not knowing what “blem” meant.)
With big expectations come big responsibilities
Spotify’s been looking to IPO for some time but, despite doing $2.2B in revenue last year, the company still isn’t profitable. Not the most attractive investment…
The big driver of this by far is royalties (which artists like T-Swift say still aren’t enough). By granting exclusive access for their premium users, Spotify hopes to negotiate better licensing rates with record companies.
Valued, loyal customer better have my money
Spotify was already the last defender of freemium streaming – compared with subscription only rivals like Apple Music and Tidal.
The exclusivity model is the first major move towards converting users to paid, which, to no one’s surprise, drives the vast majority of their revenue $10/month at a time.
And if you’re altogether tired of tracking who you can stream where, there’s always vinyl. Apparently gramophone records are having their best year since 1985.