Spotify CEO: “We Offer the Best Free Music Experience In the History of the Smartphone”

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(Spotify website, as of Wednesday morning)

Because music fans not only want free music, they’ve been accustomed to it since 1998.  And as the lines between laptop, tablet, and mobile become blurrier and blurrier, why should music services be slaves to history?  With that in mind, Spotify has radically shifted its previous restrictions on mobile and tablet listening, heralding a new level of free access.  That includes huge relaxations for non-paying users on smartphones, and a complete relaxation of restrictions for iPad and Android tablet users.

“Did we mention it’s free?”

Spotify press release, issued Wednesday.

Which means, there is now far less difference between Spotify’s laptop and smartphone experience, and essentially no difference between a tablet and laptop experience.  “As tablets are becoming the new desktops, Spotify users can now enjoy the same free, on-demand experience on iOS and Android tablets as they do on their computers,” Spotify CEO Daniel Ek explained.

“We’re giving people the best free music experience in the history of the smartphone and the tablet.”

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The move comes alongside a number of massively-leveraged expansions at Spotify.  That includes a fresh, $250 million investment round, and – as of this morning – an expansion into 20 more countries and an important Led Zeppelin exclusive (more on those moves ahead).

Here’s a quick look at the relaxed mobile features, which most likely required expensive licensing modifications with the major labels:

  • Playlists: Ability to listen to all playlists created, as well as those from people you follow.
  • Favorite artists: Free users can listen to the entire catalog of an artist on shuffle (unlike Pandora).  “No settling for one track every 20 minutes,” Spotify described.
  • Discovery: Ability to listen to playlists matching mood, genre, or ‘moments in time.’
  • Tablets: No difference from the laptop/PC experience.


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32 Responses

    • TuneHunter

      We need Lech Walesa of music industry!
      Santa Monica natives, chance to become history.
      Time to start occupation strike at Universal and hang on until we can wheelbarrow out at least three guys.

      In the meantime let me know where Ek, Parker and Keeling trio buys Champagne – I want to buy the store!

    • TuneHunter

      NO & NO.
      Let them stream to death as long as they pay at the discovery moment.
      If you want to hear the tune again – no matter where it came from you got to pay to listen to it again!

      Addition to play list or outright purchase YOU GO TO PAY.

      • Popeye

        Play pretend as long as you want. Or, find another model that replaces the income. Adapt or die.

    • TuneHunter

      You bet, cellular zone was approved prior to 1/4B injection.
      If they can only show 17.5B for 2013 they will IPO Spoty for at least 4B.

  1. Casey

    So no more Spotify Unlimited? Clearly their goal is no longer to get as many subscribers as possible. They just want to use their superior free service to kill their competition and secure dominance. Their new free service offers far more free features than Pandora despite paying a lower royalty rate (according to some of the recent statistics we have seen). Being free on mobile devices, it will also absolutely dominate Rhapsody and Rdio in both total users and media attention. It will probably even cannibalize existing paid Rhapsody, Rdio, and even Spotify premium subscribers.

      • Casey

        It hasn’t gotten much attention lately, but it was still an option last time I looked. That would have been in the last two weeks or so.

  2. Anonymous

    Now almost a real competitor to Youtube, with a much higher per-stream rate!

  3. David

    This reminds me of an unresolved question from the recent ‘transparency’ statement from Spotify about royalties. As described in that statement there seemed to be no way that rights-owners would be paid a lower royalty in a given territory for ‘free’ as against ‘premium’ streams. Yet various people have claimed that there is such a differential. The question becomes more important if the scope of ‘free’ streaming is now to be extended.

    • Faza (TCM)

      While it’s difficult – if not impossible – to say where the difference comes from, I have noticed that Spotify payouts do vary widely for me: anything from a cent+ at the top end to a tenth of that (or less) at the bottom, over the course of this year (with similar variability observed in previous years, though the top end has been steadily increasing over time, along with the mean rate). Some of it could be explained by fluctuations of exchange rates and such, but I doubt that these would account for differences of an order of magnitude. My guess would therefore have been that the low-end rates are for free streams, whilst the top-end ones are for Premium.

      It might even have been like this, with Spotify changing the rules now – together with all the other tweaks they’ve been doing. If so, I anticipate that payouts will decrease significantly, because there will be less money coming in for more usage (it’s a fairly safe prediction, given that they’ve already told us how they divide the money).

    • HansH

      I can confirm the rates for free streams are way lower than the Premium ones.
      My digital distributor provides statements with a breakdown per country and tier. To give you an idea:

      Free streams in the US in April: € 0.000874 Premium streams: €0.09113

  4. John Paul Jones

    Wanna to guess how much of that $250M they had to pay zep? I bet lots of other artists will now take their music down from spotify and demand to be paid.

  5. PiratesWinLOL

    Great stuff. Finally consumers are getting a fair deal on the mobile front, and I dare say that it wouldn’t have happend without the strong effort by millions of brave pirates around the world!

    Thank you Spotify, now I like them almost as much as even GrooveShark.

    • Chris

      “Strong efforts…by brave pirates” – what are you smoking son?

      Why don’t you bugger off to the tor networks where you can sit happily alongside the paedophiles and other criminals.

  6. FarePlay

    Another high visibility promotion confirming that music has no value. Not only do these long running promotions make it even more difficult for Spotify to covert free to paid subs, it also plays into their argument that they can’t afford to pay artists more, because they are already losing money.

    The irony is palpable.

  7. Tamara

    This is really bad for artists. Bascially free on-demand with payouts at the non-interactive rate (or at a negotiated rate less than that)??? At least on Pandora, there is potential to monetize on a download. On Spotify – the potential for a download is nill. I am pulling my content.

  8. River Waters

    I don’t see an endgame for them other than failure at some point. If they have to offer so much for free, it means, to me at least, that they can’t charge for it. 2 years, max.

    • @FarePlay

      You are 100% right. It’s not even an issue of the proper value of a popular artist vs emerging vs unknown. Spotify now values ALL Music with a big fat zero, zilch, nada (i.e. $0.00)!

      • Anonymous

        Popular music is worth a lot more, but the people who make it need the money a lot less. In reality, to encourage musical development new artists should be getting more, not less per stream. But it doesn’t fit in a Ayn Randian world view to do that.

  9. Anonymous

    It’s not on-demand for mobile. It’s still more on-demandish versus Pandora though, but you can’t just stream any song you want.

    • Casey

      On phones you can only play playlists and radio. On tablets though it is completely on-demand.

  10. Juice the #s, then go public

    Folks, please understand that Spotify is now in the pockets of Wall Street actors like Goldman Sachs. The only goal for taking the $250MM was to then position the company to go public (b/c there is no more money after this I think). This move is kind of a ‘bet the company’ thing. Juice the user numbers and user growth to eye-popping levels, and then take her public and cash out.

    Whether this gambit works or not remains to be seen, but the fact of the matter is they couldn’t stay where they were – on top of a melting iceberg. Time will tell. Expect a major marketing push to ramp this up asap.

    As for what this means to artist payouts? Well, dividing zero in half doesn’t matter much.

  11. Anonymous

    So the time restrictions on free users have apparently been lifted (outside the US) according to Spotify forum staff.