Spotify is limiting features for free-tier users in India to encourage more paid subscriptions. Discover the changes and their implications for the Indian music streaming market.
Spotify Tightens Restrictions for Indian Free-Tier Users
Spotify, the popular music streaming service, is implementing restrictions on its free-tier users in India. These changes aim to drive more users towards paid subscriptions. This move comes several years after Spotify’s launch in India in 2019.
Under the new restrictions, free-tier users in India will no longer be able to:
- Play songs manually in a specific order.
- Rewind, scrub, or repeat songs.
These limitations are a departure from Spotify’s previous approach in India. Earlier, users enjoyed more freedom in song selection.
Maturing Indian Market Spurs Changes
Spotify justified these changes by stating that the Indian music streaming market has matured over the years. As a result, it believes that modifying the free tier is necessary to align with the evolving dynamics of the market. This shift in the free tier offering brings it closer to the model Spotify employs in Brazil.
Despite the adjustments, Spotify acknowledges India as one of the top five countries in terms of monthly active users on its platform. However, it falls short of being a top market for subscribers, as a significant majority of Indian users prefer the ad-supported free tier.
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In addition to the restrictions, Spotify is introducing “Smart Shuffle” in India. This feature automatically suggests songs based on a user’s music preferences and the song or playlist they are currently listening to. Initially launched for subscribers, it aims to enhance music discovery for users.
Industry experts view Spotify’s changes positively and anticipate a shift towards a subscription-based model. However, there is uncertainty about whether these restrictions will drive users to pay for the service or lead them to explore alternative platforms.
Trends and Challenges in India
Spotify is not the only music streaming platform adjusting its strategy in India. Last year, Gaana, backed by Tencent, adopted a paid-only model. Resso, owned by ByteDance, eliminated its free tier in India, Brazil, and Indonesia earlier this year. Additionally, TikTok Music was launched in Brazil and Indonesia, marking the discontinuation of Resso in those markets.
Tech news 🗞 October 9, 2023
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👉 Spotify puts restrictions on its free tier in India to attract more paid users
India does not rank among the top 10 markets for music streaming subscriptions. This comes according to the International Federation of the Phonographic Industry (IFPI). The country also faces a significant digital piracy issue. It has a piracy rate of 73%, above global average of 30%.
Spotify’s Competitive Position
A Redseer analytics report from April revealed that Spotify led in terms of the number of streams in India, excluding YouTube. Despite Spotify’s strong performance, YouTube, with over 450 million users in India, remains a formidable competitor in the country’s music streaming landscape.
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In the global context, Spotify reported 220 million subscribers for the quarter ending in June. Thus, it marks a 17% year-on-year growth. The company also raised its subscription prices in the United States. This indicates its commitment to growth and profitability.
