Spotify seems to need India more than India needs Spotify.
After years of waiting, Spotify may finally launch in India in the next six months, if a report by Variety is to be believed. The report also states that Spotify, when it launches in India, will offer an extended free trial period which will be longer than 30 days. Under the free trial, Indian users will get full-access to Spotify Premium which the Swedish streaming giant offered in Vietnam and South Africa when it launched earlier this year. A Swedish publication Di Digital reported that Spotify’s plan to buy an Indian competitor fell through and the streaming platform will enter the Indian market on its own.
Spotify recently launched in a bunch of international markets including the Middle East and North Africa. It now offers services in 78 markets globally. Spotify’s India plans have been years in the making. The company opened an office in Mumbai in March and even got publicly listed, hiring 300 people. Variety reported that insiders in the Indian team are optimistic that the service could launch in India as soon as in the next six month.
Spotify’s phenomenal growth since its launch in 2008 has been well-document. However, even though it raked in new subscribers exponentially, it’s operating costs also rose rapidly. Spotify co-founder Daniel Ek believes that increasing the subscriber count will lead to more profits for the shareholders. However, even though the music streaming platform reported 83 million premium subscribers in July 2018, it’s net loss nearly doubled to $461 million. Spotify is also facing decreasing stock price and tough competition from the likes of Apple Music and Amazon Prime Music, Spotify’s plan to enter the Indian is hardly surprising. It seems Spotify needs India more than India needs Spotify.
The Indian market for music streaming is now in its consolidation phase. Homegrown service Gaana surpassed 80 million subscribers and raised $115 million funding from Chinese giant Tencent and Bennett Coleman’s Times Internet, while Saavn merged with JioMusic in a $104 million deal. There is also Hungama, Airtel Wynk and others, apart from the services from American giants — Apple Music, Google Play Music and Amazon Prime Music. According to the reported, Spotify was eyeing to acquire either Gaana or Saavn to bolster it’s plans for the Indian market.
Spotify’s plans to launch in India was further impeded by the company’s plans to bypass the record labels and license acts directly. The move reportedly made major music labels in India threaten to spoil Spotifiy’s progess in the region by blocking its licenses. Although, the report states multiple sources claim the hurdle has been cleared with Daniel Ek downplaying the rumours during Spotify’s earnings call in July.
When Spotify eventually launches, it will also have to take into account India’s vast linguistic diversity. With 1.33 billion people speaking a variety of dialects, Spotify will have to work hard to cater to everyone. Although, in markets like Indonesia, Africa and in the Middle East, Spotify played by the books and introduced playlists and recommendations in regional languages. There will also be the question of converting the free users to paying subscribers and the company should hope than an extended period of free trial will seal the deal.
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