Spotify and Universal Music Group have finally put pen to paper on a new global licensing agreement.
The global market-leading streaming company and the world’s No.1 music company say the deal “further aligns the companies’ efforts to foster groundbreaking new features providing value for artists and great experiences for music fans”.
There are few details in the statement beyond that, although the press releases does add: “With this new agreement, the companies advance their industry-leading partnership, reflecting a shared commitment to music’s continued growth, deeper music discovery experiences and collaboration on new, state-of-the-art marketing campaigns across Spotify’s platform. Additionally, as music’s most innovative company and one of Spotify’s earliest supporters, UMG will deepen its leading role as an early adopter of future products and provide valuable feedback to Spotify’s development team.”
The companies’ previous deal, in 2017, saw Spotify agree to window releases on premium sites, probably in exchange for a lower payment rate, although precious few artists have taken advantage of that windowing since.
That deal is believed to have expired last year, meaning they have been on a rolling contract since while working on this new deal. Spotify, which has still not achieved profitability despite its successful IPO, will likely have sought a further reduction in the amount of money it pays out to Universal, while Universal will no doubt have been looking to leverage the strength of its catalogue to push its own agenda.
Whatever the details, bosses at both companies seem happy.
“With this agreement, UMG and Spotify are more aligned than ever in our commitment to ensuring the entire music ecosystem thrives and reaches new audiences around the globe,” said Sir Lucian Grainge, chairman and CEO of Universal Music Group. “Given our commitment to innovation and early adoption of music technologies, and Spotify’s leadership in the development of forward-thinking tools, our new partnership will provide our artists with new and powerful opportunities to connect with fans on Spotify’s growing platform. Working together, our teams will expand and accelerate our collaborative efforts to deliver artist-focused initiatives, strategic marketing campaigns and new offerings to provide exciting new experiences for fans worldwide.”
“From their early experimentation with [paid-for marketing programme] Marquee, to testing new experiences like [visual feature] Canvas, Universal Music Group has been an important partner in helping to shape the development of our marketing tools,” said Daniel Ek, chairman & CEO of Spotify. “With today’s announcement, we will expand on this level of early stage innovation and further strengthen our partnership and shared vision for helping advance artists at all stages of their careers. We've said all along, the goal of our Marketplace strategy is to harness Spotify’s ability to connect artists with fans on a scale that has never before existed and bring new opportunities to the industry. Together, we look forward to reinvesting in and building new tools and offerings for artists around the world.”
More new Spotify deals are likely to follow – watch this space.
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