Spotify has accidentally announced that it would be launching in India as soon as 31 January in an updated version of its end-user terms and conditions for India (hat tip – Aroon Deep). Variety reported the same possible launch date, adding that Spotify was entering India solely on the back of its recent deal with T-Series. Spotify has not finalized deals with three other major music labels Sony, Universal, Warner.
However, Variety also reported that the India launch was being held because of the low royalty Spotify initially offered for the free-trial period, which was dramatically lower than what domestic services would offer. It added that Spotify will be available in English, and music in five languages during the initial launch, and will later look at expanding into different regional markets, as the music market in India is dominated by Punjabi, Tamil, Telugu, Malayalam and Bengali music.
Extended free trial ‘significantly longer’ than 30 days
Spotify will launch with an extended (free) trial period that will be reportedly significantly longer than 30 days, which is what it offered in South Africa and Vietnam in 2018.
The music streaming market in India is an already crowded space with the likes Amazon Prime Music and Apple Music, and domestic players like Gaana, the newly merged JioSaavn, Wynk and Hungama. It is unclear what Spotify will cost its users every month. Its worth noting that most existing music streaming services offer their service at a monthly price of ₹99, with free trials varying from 1 week to 1 month across different services (Apple Music costs ₹120 per month, but offers a 3-month free trial period).
Spotify and India: a late blooming story
Reports of Spotify’s India launch have been making the rounds for the last few months. In November last year, we reported that Spotify could launch in the next six months, and that plans to buy a local competitor had failed.
In March 2018, CEO Daniel Ek had announced that the service would launch in India, without specifying a timeframe. In a stock exchange filing, Spotify noted that it had a dedicated office space in India, with 308 employees.
In an investor call in November last year, Ek had said that, “India specifically is a very fragmented marketplace, with lots of different local labels, lots of different local publishers.” He added that when the company deals with ‘licensing situations’, “it’s very hard for us to predict accurate timelines on the basis of multiple partnerships — just the sheer scale of number of partnerships makes it very hard to predict that, but there’s nothing that we see that prevents us from launching in India.”
Former OLX India CEO Amarjeet Singh Batra heads Spotify India, while Akshat Harbola heads the marketing operations in Mumbai. According to LinkedIn, Vasundhara Mudgil has been the head of communications at Spotify’s Mumbai office since September.
Spotify has 191 million monthly active users and grew its premium subscribers by 28% YoY to 87 million (see Q3 results pdf). Premiums earned it a revenue of €1,210 million out of a total revenue of €1,352 million in Q3 2018. Ad revenue was €142 million in the quarter.
- Spotify IPO: Lessons for music streaming companies in India