UMG Strikes Deal With Spotify
Earlier this month, No. 1 music streamer Spotify and major label Universal Music Group reached a deal in regards to having the label’s songs streamed on Spotify. The agreement sets royalties in such a way that allows Spotify to pay less to the label if it reached certain revenue goals.
However, the most surprising part of the deal is that Spotify is giving Universal the ability to make new album releases available only on the service’s paid tier for two weeks after release. In the debates surrounding streaming, Spotify has always maintained the stance that wide releases to “freemium” users and paid users would be the best way to reach new audiences. This implies that it would be in the artist’s best interest to have such a release. Despite this, many artists have held new releases from Spotify because there was no windowing option that gave exclusive listening capability to paid users. Some artists, like Taylor Swift, have gone so far as to keep their entire catalogs off of Spotify.
With all this in mind, it seems as though it was in Spotify’s best interest to allow labels and artists to utilize the windowing option.