Spotify now plays in Phl

MANILA, Philippines - Truth be told, the dawn of the digital era was both a boon and a bane for the music industry. While unshackling songs from the limitations of the analog format, piracy was taken to previously unheard-of levels — seriously impinging on revenues of record labels and, as a consequence, musicians/artists themselves. Sales of CDs (and even DVDs) began to plummet — a casualty not just of digitization but the increasing availability of illegal copies whether on the Internet or local bootleg retailer.

Peer-to-peer file sharing services such as Napster also raised howls of protest from the industry, yet the general public logically went down the path of least resistance (and cost), until a more rigorous framework for protecting copyrights gradually shut many sites and services down.

At the outset, Daniel Ek and Martin Lorentzon seemed to have another litigation magnet on their hands when they developed Spotify in October 2008 in Stockholm, Sweden. However, the commercial music streaming service crucially distinguished itself by seeking the imprimatur of record labels — which Spotify remunerated in exchange for the use and webcast albums from their portfolio.

Almost six years later, Spotify is officially in the Philippines. In an exclusive interview with The STAR, Spotify Singapore Pte. director for Asia Sunita Kaur says the “one very clear vision was to build a service better than piracy,” basically overhauling the adversarial relationship of music vis-à-vis the Internet. “A lot of people thought that they (Ek and Lorentzon) were crazy,” she continues.

Today, Spotify is now in 56 countries — offering access to a mind-boggling 30 million songs basically for nothing. The so-called “freemium” model allows registered users to search and listen to any song in exchange for some advertisement on the Spotify screen. Premium services cost P129 a month (payable through a credit card), which removes ads from the experience, while allowing subscribers to download music and listen to them offline in high-quality audio. Both, insists Kaur, generate revenues — a hefty 70 percent of which is plowed back into the music industry (again, through the labels).

The Spotify application itself is free to download across a range of devices — PCs, mobile phones, tablets, and even in some home Wi-Fi entertainment systems.

Most importantly, Kaur asserts: “We’ve got enough money to pay the artists back.”

Spotify reports it has 24 million active users, over six million of which are paying subscribers. The company also boasts it has paid over $1 billion to rights holders since its launch. But its executives envision the service to be in every country; Spotify grows prudently for a good reason.

Avers Spotify Australia Pty. Ltd. communications director for the Asia-Pacific Jim Butcher tells The STAR: “The reason we cannot just flick a switch and (make Spotify) available in the world is the fact that we negotiate with every single major label, indie label, collecting societies, and publishers to make sure that we are fully legal in every country we launch in and that we are paying back revenues to the industry with every single song we play.” Yes, you read that right. Spotify pays for each song every user (whether paying subscriber or free client) plays.

That means Spotify executives did their groundwork here by getting local affiliates of record companies on board. Kaur excitedly points out that there are a lot of OPM songs available on Spotify now.

The paradigm works in a framework of trust. “It’s transparency,” she says. “We say we are about the music. We say we are about the artist. We have to show that we are about the music and about the artist. First, 70 cents of every dollar that we make goes back to music. We have built a dashboard for artists, and on this dashboard they can see how their music is doing. So they can see how much money they are making.”

Butcher shares that studies have shown an inverse correlation between piracy and the Spotify usage. “If you look at the markets we have launched in already, music revenues in those markets have gone up,” he declares. “If you look at Sweden, the spiritual home of Spotify, we have basically revolutionized music there. It’s the home of The Pirate Bay (a website of links facilitating peer-to-peer file sharing via BitTorrent), but since we have been there, piracy has fallen and revenues are pretty much back to levels of the golden age of music which was the ‘90s and the CD boom.”

He continues: “Now everyone is listing to Spotify, pretty much and revenues are going through the roof. We would like to believe that we can bring that level of music in all markets, including the Philippines.”

For her part, Kaur likes to believe that people don’t intentionally want to pirate music. “They want a way to access music quick, simple, and which sounded great. What if I told you that I could give you that in a way that was free, safe, and legal? It’s easy for me to tell you not to pirate music, and support the music industry that you love. But if I give you an alternative, it makes that choice a lot easier,” she says.

Adds Butcher: “What (music labels) found out unequivocally was that Spotify was actually helping raise music revenues everywhere. We were not impacting people who were buying CDs; we were impacting people who were transferring music illegally.”

Spotify enables users to listen to entire albums, create a playlist, and even listen to a customized radio station or genre stations. A “discover” function “seeks out personalized recommendations by combining Spotify’s best-in-class technology and social tools with curated contents from music experts.”

More than a smart player, Spotify is a social media ecosystem in itself. Users can follow other users, share playlists and songs, discover the musical preferences of celebrities, and other niceties. Of course, privacy settings are available if you are the introverted type and just want to listen to your picks in peace.

Spotify has partnered locally with Globe Telecom as its telecommunications partner in the Philippines — offering postpaid, prepaid, and Tattoo-on-the-go prepaid subscribers free access to Spotify through its data plan, GoSURF.

The core of Spotify, maintains Kaur, will always be music. “It goes back to being about the artists that make music,” she says. “Music is part of us since the day we were born. For the longest time, the music industry and artists have struggled. Spotify is (about) rewarding artists as best possible.”

Concludes Butcher simply: “The magic of Spotify is that every time you play music, money goes back to the industry — even when you listen for free.”

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For more information, visit www.spotify.com or check out www.facebook.com/spotify.