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Spotify arrives to shake up SA music industry
The global leader in music streaming has arrived in South Africa, and is set to shake up the industry, writes ARTHUR GOLDSTUCK .
The final death knell has been sounded for the thousands of iPods still in use in South Africa. Due to the high cost of streaming music via mobile data, many have held onto the one-time standard in storing music that was bought or copied onto a portable device.
That is about to change, as the world leader in music streaming, Spotify, was formally launched in this country yesterday. And it making a big play for the local audience.
“Our product stands for discovery: discovering new music and music you will like,” says Michael Krause, Spotify MD for Europe, Middle East and Africa. “We have local and international artists. Local content is so important which is why we made a huge effort to get local artist licensing.”
Krause stresses that Spotify’s arrival would be a boon not only or music lovers, but for the artists as well.
“It will give all the artists access to over 159-million customers, so we hope more South African artists will have great exposure outside the country, and also to local fans who will discover new artists they didn’t know. We hope more artists will be able to make a living off our service.”.
And there is one other massive potential benefit.
“Streaming is a key driver for industry growth in general,” says Krause. “Music streaming really helps to boost markets, even where there was a decline because of digital music. It has changed markets back to growth. These are features we hope to emphasise in South Africa.”
Spotify is available in both a free version, supported by advertising, and a paid version, which will cost R60 a month – as little as half of the $10 price tag in the United States. This positions it at the same price as other major streaming services in South Africa, like Simfy Africa and Google Play Music. As with Simfy, users will be able to download music onto their smartphone when in a Wi-Fi zone, and play it offline when only expensive mobile data is available.
The one fundamental difference to other streaming services, however, is that few users will experience a difference between music available locally and internationally. That means current users who have been “cheating” by signing onto the American service won’t be disadvantaged when they switch.
“All South Africans can simply change the country and payment mechanism so that they can pay the local pricing,” says Claudius Boller, Spotify MD for Middle East and Africa. “The interesting thing is that it’s the same music, so you don’t lose any of your playlist.
“Our standard international offer is live in this market, and there will be more local content available. It’s a very tiny amount of content that may not be available due to licensing rights. We’re a 100% legal service, so we have everything licensed.”
Krause says that Spotify has had the African continent in its sights for a while, but chose South Africa as the continent’s launch pad due to a combination of music culture and better connectivity. Not mentioned in this context is the fact that, because the service currently requires credit or debit cards, Nigeria poses particular challenges. Many online services do not accept credit card from the continent’s largest music market
“Not everyone has a credit card available,” Krause says diplomatically. “Other payment options will come after the first launch. We will make sure we have all payment possibilities so that people have no boundaries.”
Meanwhile, the South African launch coincided with the service going live in three other countries yesterday, namely Israel, Romania and Vietnam.
Spotify is expected to make a similar impact on streaming music in South Africa as Netflix made on the video-on-demand industry. Netflix came into a market that had been gearing up for its arrival, but it still cleaned up, thanks to a vast and fast-growing catalogue of original content.
This still left room for a variety of niche players, like Digital Entertainment on Demand (DEOD), which emphasis extreme and school sports, Kwese Play, with a strong African focus, and Cell C’s black, which fills various gaps in between.
Music streaming, on the other hand, does not lend itself to providers creating their own content, nor to artists providing exclusivity to one outlet – although there are exceptions. This means anyone in the market for a music streaming service is likely to choose only one. Spotify’s free version, along with the large existing fan base for its paid service, means it will be the first stop for most music lovers.
It is also likely to have one other effect that would not be encountered in developed markets. Because of the massive awareness that will spring from local artists punting Spotify to their fans, it will probably create a spike in app usage by South Africans who had migrated to smartphones but remained wary of data use.
In this way, it may well be a catalyst for growth in industries beyond only music.
* The Spotify app can be downloaded via the Android or iOS app stores or on the Web at www.spotify.com. The premium service offers a 30-day free trial.
Spotify facts and figures
Spotify offers the following curated playlists for South Africa:
Top Hits South Africa
New Music Friday SA
Hip Hop Juice
Sunday Praise
Gospel Greatness
House Nation
iGqom Le
Rock Essentials
Made in South Africa
Beste Pop
Maskandi Favourites
The Hip Hop Circle
Chilled Vibez
Sunday Feels Feel Good Look Good
Nine 2 Five
Gym Beats
That Party Feeling
City Back 2 Kasi
SA Gold
Spotify stats:
- Over 159 million active users
- Over 71 million subscription users
- Over 35m tracks in the catalogue
- Over 2 billion playlists available
- Over €8 billion paid to rights holders since launch in October 2008
- Available across 65 markets including South Africa
Spotify Free features:
- Full catalogue access
- Curated, personalised playlists, background play and charts
- Listen to any artist, album or playlist on Android and iPhone handsets
- Access to the full Spotify catalogue on desktop and tablet
- Create playlists and share with friends on Spotify, Facebook, Twitter, text and email.
Spotify Premium:
- On-demand music with no ad interruptions on computer, phone and tablet
- High quality streaming (320kbps)
- Listen offline
- Use Spotify Connect to play Spotify on a connected speaker, TV and car.
