Spotify silent on major release restrictions claims ahead of proposed IPO

Spotify silent on major release restrictions claims ahead of proposed IPO

Spotify has refused to be drawn on reports suggesting that the streaming giant is in talks with the three majors to accept lower streaming fees in return for premium releases.

According to sources at the Financial Times, Spotify is on the verge of an initial public offering. Following negotiations with Sony, Universal and Warner, it has been reported that the majors will reduce their fees, with Spotify then restricting availability around key releases to premium subscribers only.

Spotify have declined Music Week requests for comment, although it is alleged that a deal could be inked between the streaming service and the majors within weeks.

Should Spotify secure such agreements with the majors, its bid to go public would be given a significant boost, as it aims to persuade investors that the rapid expansion in its subscriber base can be turned into a solid business proposition.

The company was recently valued at $8.5bn in a funding round, although it made a net loss of €173m in 2015, despite revenues rising to €1.95bn. Royalty and distribution fees jumped to €1.63bn.

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