Spotify, in a major shift in its service, is about to make some music available to paying customers alone.
Spotify dominates the music streaming industry with the largest paid user-base, with a reported 50m paying subscribers and 50m free users on top of that. Apple’s 20m users and Tidal’s 3m clearly fall in the shadow, and Spotify has boasted for quite some time now at least some of its scale to the importance of its comprehensive free tier marketing tool.
Spotify risks a reduction in royalty fees paid to the labels per stream by restricting some music from free users, but the possibility of exclusive releases from artists like Kanye West, Taylor Swift and Beyoncé is very real, all of whom have restricted new albums to the paid tier of competing services in common, such as Apple Music and Tidal.
Free tier might just eat away at other audiences being it pays lower royalties per stream, as many labels tend to think, thereby compromising album sales and lowering the incentive to upgrade to premium.