Spotify is launching its music streaming and downloading business into the Middle East market.
There is a lot of piracy in the region and Spotify want to capitalise and bring in music consumers to their platform to make the Middle East more legal when listening and buying music.
Spotify already operate in the safe worldwide zones, which is North America, Western Europe and Pacific countries – Austraila and New Zealand – though over the past five years Spotify has got countries in North Africa, which includes South Africa, Eastern Europe, Central and South America and parts of Southeast Asia.
Spotify like their competitors have drastically reduced illegal downloading from over a billion to a few hundred million – so that in itself is an achievement, which hopefully will have a great benefit to music creators and their record companies, as well as to Spotify’s investment.
Spotify have been in the headlines for having to renegoiatate with major record companies over the share of revenue Spotify generated through music streaming and downloading – forcing Spotify to pay a minimum £1.5 billion per year.
Furthermore, early this year Spotify lost a copyright infringement case with song publishers and will have to pay for back-royalities, which will set the company back £85 million.
Currently Spotify isn’t profitable but generates revenue of £4.5 billion per year and is valued at £20 billion – having recently floated on the New York Stock Exchange (NYSE). Spotify has a healthy status amongst its investors who see Spotify as a worthwhile company to keep supporting.
Spotify hasn’t released the number of users it hopes to attract, but we’ll have to wait for at least 3 months until Spotify starts to release this information.