Spotify could move into video later this month as Apple targets streaming music

Spotify 2.2 for iOS Touch Preview iPhone screenshot

Spotify, the world’s leading music-streaming service with sixty million listeners on a free tier and fifteen million accounts on its $9.99 per month tier, could start integrating video into its service as early as this month, according to a report published Friday by The Wall Street Journal.

A video-streaming service should complement Spotify’s music platform. The company reportedly has the likes of Facebook and YouTube in its sight, the latter working on a paid subscription service of its own.

Google’s Music Key allows Play Music subscribers to watch ad-free music videos on YouTube and Jay Z’s Tidal includes access to music videos in its subscription and will soon live-stream concerts and related events to users. Rdio briefly experimented with video, too, but pulled that service over lack of interest.

Earlier today, the privately owned Swedish startup sent out invites for a May 20 press event in New York City ahead of Apple’s Beats Music relaunch at WWDC next month.

“The Spotify service will not be comparable to Netflix, Hulu or other video offerings,” The Financial Times added. “Instead, it will support the company’s core music service.”

“Spotify is hoping to enjoy an advantage in producing video based on the data it already has about consumers from their music-listening habits,” adds WSJ.

The Spotify video rumor and the media conference arrive hot on the heels of indications that Apple has been pressuring record labels to abandon Spotify’s free, ad-sponsored streaming tier. In turn, the move apparently provoked scrutiny from both the United States Federal Trade Commission and Department of Justice which are now looking into Apple’s business habits.

The Journal learned from plugged-in sources that Spotify “has been reaching out to companies that specialize in making content for YouTube.”

Moreover, it’s been mulling buying existing content and considering partnering with multichannel networks on original video, like YouTube does, while inquiring media companies about potential alliances.

Time Inc., Tastemade, Maker Studios and Fullscreen are among companies talking to Spotify, according to people familiar with the matter.

“The video service Spotify envisions likely would be available to subscribers and non-subscribers alike, and could eventually include advertising,” reads the report.

Spotify is also nearing a deal to raise $400 million in a round valuing the company at a cool $8.4 billion.

“We’ve got some news,” teases Spotify’s invite for the May 20 press event which can be seen below. Spotify’s event is scheduled to begin at 11am and you can count on us to keep you updated.

Spotify May 20 press invite

Apple’s rumored Beats overhaul is reportedly due at WWDC.

Apple’s new subscription music-streaming service is thought to feature exclusive content, an Android app and more. The iPhone maker is said to be using its formidable brand power and leveraging celebrities like Taylor Swift and other big name artists to promote the forthcoming service.

With nearly eleven percent of iOS device owners in the United States using Spotify on a weekly basis, as per data published by The Information, Spotify has more to lose from Apple’s Beats Music relaunch than its competition.


Industry sources said Apple had to back down from lowering monthly pricing for its subscription service to $7.99 from $9.99 because record labels wouldn’t change their established business models.

Spotify has also been turning up the heat on Beats relaunch by complaining about Apple’s standard thirty percent cut it takes from In-App Subscriptions. The so-called ‘Apple tax’ basically forces Spotify to raise the standard $9.99 price of its Premium service to $12.99 in order to pull in the same revenue, while Apple can still offer Beats at a lower price.

“They control iOS to give themselves a price advantage,” an unnamed industry source told The Verge. “Thirty percent doesn’t go to any artist, it doesn’t go to us, it goes to Apple.”

Source: The Wall Street Journal, The Financial Times