Yesterday, Spotify announced an exciting new development which allows music lovers to use a limited version of Spotify, for free, on their phones. This new free tier does not have the unlimited, on-demand and offline functionality of our Premium plan, but instead allows users to listen to their playlists and discover new artists in “Shuffle Mode”.
Spotify’s desktop free tier has been an essential component of our ability to compete with piracy and encourage people to listen to music legally. Over the last 5 years, this free tier has helped us to attract 24 million users, 25% (6 million) of whom now pay £/$/€120 a year.
A big part of the value of subscribing to Spotify has been the ability to take your music with you on your mobile device, something free users could not do. So why have we launched a free mobile service? Well, the world has changed! When Spotify launched, smartphone adoption was in the single digits, but now, smartphones are ubiquitous, and, in many cases, are now the primary devices most people use to access The Internet and their media. Smartphone access is no longer a luxury, it’s the norm.
This new norm means that the vast majority of mobile music consumption is taking place through services that pay little or nothing back to the music industry in royalties. Just ask any teenager how they listen to music on their phone, and they’re likely to show you an app for ripping music videos from YouTube. Spotify’s mobile free tier enables us to compete with mobile piracy and other services that are free on mobile. From there, we will continue to convert free listeners to paying customers and continue to pay higher rates to artists than other services.
We’re not giving everything away for free, though. The new mobile free tier is designed to allow curious music lovers to get a taste of Spotify for free but with a number of restrictions that will encourage subscription in even greater numbers. Users on our free mobile tier will not have the on-demand or offline functionality that our Premium users enjoy on mobile, they won’t be able to choose specific tracks from albums or play single albums in full. Instead free users will only be able to play playlists or artist catalogues in “Shuffle” mode, which is comparable to other popular online radio services. (For more info on the limitations and the differences between mobile free and Premium please see the bottom of this blog post).
How does this affect artists? Spotify’s royalty model will remain unchanged by this, and the details on these pages still apply. The mobile free tier will help us to grow quicker, which is good news, because the quicker we grow, the quicker we will generate even higher royalty payments like those projected here. Every day, thousands of users try to use Spotify on their mobile devices, but many leave when they find our prior mobile experience limiting. These users go back to piracy or other poorly monetized services. By offering a free mobile service, Spotify will be able to rapidly increase the number of users who explore the service long enough to fall in love with it and then to join our Premium tier.
In addition to generating higher royalties, the increased mobile user base will be able to utilize Spotify’s artist tools. These music fans will be able to Follow you on Spotify, easily share your music with friends, and buy your concert tickets when you are playing in their cities. Very shortly, they’ll also be able to purchase your merchandise, right from their mobile devices. This isn’t just an opportunity for Spotify to convert more users; it’s an opportunity for artists to convert more curious listeners into active and valuable fans.
Spotify’s free tier is now available to users in all of the countries where we are live. For more information, please see this blog post, and if you have any questions, don’t hesitate to contact us.
-The Spotify Artist Services Team
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How is this different from the premium mobile experience?
Our goal was to make the best-possible free mobile music product and keep what is unique about Spotify, while not degrading the value of the Premium experience. Differences between free and premium on mobile:
- Online only: Offline Mode is still only available to Premium subscribers
- Ads: Free users still experience audio and display ads on their device
- Continual shuffle mode: The free product is always in shuffle mode. This means that listeners can’t choose the exact order of the songs they’re listening to or access a song on-demand.
- No tracks on demand: Free users can’t choose a specific song to listen to. Instead, if someone taps a specific song, they can add it to their playlist, or start a radio station. This includes a users’ own local files.
- Limited skips: Free users are limited to six skips per hour.
- The addition of “Suggested Tracks”: Spotify will occasionally add related tracks into the listener’s queue. This happens when the user has run up against a few additional restrictions within our licensing agreements with regards to playing consecutive tracks from individual albums. Suggested tracks are always related to the content the user has chosen and in testing have not been problematic for listeners.
- A playlist must have at least 20 songs
- A playlist must consist of at least three albums
- Even if you list the same track 20 times in a row, it still only counts as one