Spotify India, a one-week update: one million subscribers!
When it comes to Spotify, the world’s pre-eminent music streaming platform, recent news has almost all been about just one thing: its entry into India. The company has made a big bet over how many users it can add in the coming months, and India (one of the world’s most populous countries) is a major part of it. That said, India poses certain challenges: its fragmented music market and low-income consumer base being the two biggest.
Add a last-minute legal fallout with Warner Music Group (WMG) to these challenges and you could be forgiven for being slightly wary over Spotify’s chances. So, one week in, how has it gone? Incredibly, the company has already signed up more than a million Indian subscribers.
Spotify’s share price has risen by 25% so far this year
Source: Yahoo Finance
One of the likely reasons that Spotify has seen such overwhelming success early on is the incredibly low price point at which it’s entered the country. To put that price point in perspective, if you want to use Spotify in the US, a subscription will set you back $9.99 per month. In India, it will come in as low as $1.70 – more than 80% cheaper. And, in both territories, you get a 30-day free trial to decide whether that’s a monthly fee you’re willing to pay.
Spotify is not alone in adjusting its prices for the Indian market. Amazon Prime is priced 73% lower there than it is in its home territory of the US – and, like Spotify, it’s seen strong adoption rates. Although its content library in India isn’t as large as it is in the US and the UK, Amazon Prime apparently had as many as ten million subscribers in the country by last year.
The big question for Spotify in the near term will not be whether it makes money in India (spoiler alert: at these prices, it won’t), but rather whether it can gain a strong foothold in the country. India, like China before it, is a growth story – as wages rise and connectivity spreads, money will come. But only the services that are well-established will be in a position to capitalise. So far, it’s going incredibly well.
Dominion holds Spotify in its Global Trends Luxury Fund.
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