Spotify signs deal with world’s biggest record label

Despite its 100 million users and 50 million paid subscribers, Spotify loses money. The deal will nudge its free users to pay up.

Photo by: AFP (Archive)
Photo by: AFP (Archive)

Spotify, a rival to Apple Music, has yet to report a profit.

Updated Apr 6, 2017

Music streaming service, Spotify has signed a long-term deal with the world's biggest record label, Universal Music Group.

Under the new deal, Spotify, unlike its industry rivals, will get first dibs on music from some of the world's most popular artists.

Spotify, a rival to Apple Music, has yet to report a profit as it expands, but is under pressure from some artists who have boycotted the usually free service and needs to show investors it can generate cash as it considers a US listing.

The multi-year licence agreement with Universal Music could make Spotify more attractive to Universal Music's artists, who include Taylor Swift, Adele, Lady Gaga, Coldplay and Kanye West.

"We know that not every album by every artist should be released the same way, and we've worked hard with UMG to develop a new, flexible release policy," Spotify Chairman and Chief Executive Officer Daniel Ek said in a statement.

"Universal artists can choose to release new albums on premium only for two weeks, offering subscribers an earlier chance to explore the complete creative work, while the singles are available across Spotify for all our listeners to enjoy," he said.

Despite its 100 million users and 50 million paid subscribers, Spotify loses money. The deal will nudge its free users to pay up.

TRT World’s Adefemi Akinsanya reports.

Source: 
TRTWorld and agencies