Spotify signs Universal Music, may get to U.S. after all
The pact means the streaming music company now has U.S. deals in place with three of the four largest labels, making it likely that it will finally be able move across the Atlantic this summer.
Spotify has signed an American distribution deal with Universal Music Group, the world's largest music label. The pact means that the streaming music company now has U.S. deals in place with three of the four largest labels, making it likely that the company will finally be able move across the Atlantic this summer.
The service still doesn't have a pact signed with Warner Music Group, but people familiar with discussions say the two sides are closer than they have been in the past, and are optimistic a deal will get done. It's possible that Spotify could open in the U.S. without Warner, but that would leave holes in the company's catalog. And that's a crummy way to introduce a service that CEO Daniel Ek has been promising to bring to the U.S. for two years.
Even if Warner signs next week, though, it will likely take Spotify some time to ramp up a marketing campaign and other elements it would need for a U.S. launch. I wouldn't count on seeing anything in the States till July at the earliest.
Multiple sources tell me the Universal deal was finished this week. Spotify declined to comment; a spokesman for Universal hasn't responded to requests for comment. Spotify signed on Sony and EMI Music Group earlier this year.
In Europe, Spotify offers a "freemium" service, where registered users can listen to a certain amount of music each month for free, and paying subscribers get unlimited music, which they can stream to their computers or phones. People familiar with the company's plans indicate that it wants to do the same thing in the U.S., and would likely charge around $10 a month for the premium service.
Unlike in Europe, however, there are several existing subscription services that also stream unlimited tunes for $10 a month, and those have yet to take off, even though the services are now compatible with popular handsets like Google's Android and Apple's iPhone.
During the time that Spotify has spent trying to get to the U.S., meanwhile, three different cloud/locker services have launched in the U.S. as well: Amazon and Google allow users to move their own music to an Internet-based server, where they can stream it to PCs and some phones.
Apple has announced its own take on the concept, which will allow users to download copies of music they own to different devices (it's possible that version will also allow streaming at some point).
The price point for those services all range from free to a few dollars per month--much cheaper than $10 per month Spotify will likely ask for. But they're a different offering: Google, Amazon and Apple are all promising to give you mobile access to music you already own, while subscription services like Spotify give access to millions of tracks you don't have.