• Sweden edition
 
'Spotify earns us more than iTunes': Sony BMG

'Spotify earns us more than iTunes': Sony BMG

Published: 11 Aug 2009 14:10 GMT+02:00
Updated: 11 Aug 2009 14:10 GMT+02:00

Sales of CDs in Sweden have been on the decline for over ten years and by 2008 they had collapsed to 14.7 million albums. Illegal file-sharing, widespread in hi-tech Sweden, has shouldered much of the blame.

But the explosive success of Spotify, a streaming music service launched in October 2008, has turned the financial tide for the hard hit music industry.

"Spotify is a success. Not just in terms of users but also with regard to revenues for music companies. Spotify is now bigger than iTunes in terms of our monthly revenue in Sweden," Mark Dennis, head of digital music at Sony BMG Sweden, told The Local on Tuesday.

The convictions of four people behind The Pirate Bay on charges of being accessories to copyright infringement in April, as well as the passing of tough new anti-piracy legislation, have led to a dramatic fall in internet traffic, attributed to a decline in illegal file-sharing.

"Sweden has been more prone to illegal file-sharing than other markets. Spotify came at an opportune time and has filled a gaping hole in consuming music. The low cost entry level is the secret to its appeal to file-sharers," Dennis said.

Spotify has rapidly grown to over a million users in Sweden on the back of a business model that allows users to obtain advertising-funded music for free, or alternatively for a low fixed monthly fee.

Despite the advance of Spotify's subscription service and the continuing success of iTunes, Mark Dennis still sees a future for the CD - if the music companies get the packaging right.

"Our sales of CDs have actually increased slightly in Sweden in the first six months of 2009 and still account for 85 percent of revenues. I think the transition to digital music will eventually occur but people still like buying CDs."

"Consumers are demanding more for their money though. We just have to develop the packaging and extra material," Dennis said.

Dennis confirms that the Ipred law and the Pirate Bay case have provided a window of opportunity for music companies to catch up with the consumer and the market.

"After Napster the music companies were caught napping. They did not have anyone to advise them. iTunes speeded this process up, and a relaxation in licensing restrictions has accelerated development."

He conceded that many of his arguments are those that file-sharers have being using for years with regard to the slow development of the music industry.

"I think that if you provide good services people will pay. That which has been previously lacking is a breadth of opportunities to consume music."

Spotify's success, Dennis argues, can only be good for all concerned.

"My hope is not that Spotify dominates the market but that it helps to create the incentive for other entrepreneurs to develop more services to meet demand. That way everybody wins," he concluded.

Peter Vinthagen Simpson (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

13:46 August 12, 2009 by eZee.se
The only way "everyone wins" is when the big labels die for pushing their product down our throats for so many years via price gauging, sham lawsuits, bribing politicians, fixing laws, fixing lawsuits (tpb trial anyone?) and meddling in far off countries social services (police raid of TPB).

Use spotify's free service, but you still cant download and keep the songs you want without some additional "hacking" of the service... instead of paying the "low" monthly fee for music you cant keep, pay $5 for a VPN connection and give the finger to the IPRED law as well as the big labels.
20:25 August 12, 2009 by mosesavalon
Major labels die? Nice fantasy, sometimes I share it. But then I realize how many indie artists would be out of business if they did. These guys are the banks of our industry. Wanting majors to die is like saying I wish the banks would go under so I don't have to pay my mortgage. It's short sighted. Read this: http://www.mosesavalon.com/mosesblog/turnabout-limewire-seduces-top-digital-distributors/#comment-306
00:13 August 13, 2009 by eZee.se
Dont know exactly what i was supposed to see at comment 306 - would you mind making your point instead of me searching that thread for it?

As for the majors dying... well, one can hope right? and stranger things have happened. One last thing to remember - the smallest of the 4 are on the ropes and 2 others have posted... ummm the opposite of profits... ;) (check ezeeDOTse for references to the above) plus with more people everyday cherry picking what they want from @mazon and iTun3s as well as just pirating instead of buying full albums like the 90s (the way the labels wish)... its just a matter of time before they go the way of the dodo if they dont change business models fast - and there i will be to first dance on their graves then pee on it.
10:40 August 13, 2009 by krzyz21
Does anyone understand Spotify business model? I understand about premium subscriber thing but what about 'invite only' registrations? if its such a success, why not open up the invitations and make a rule that every registered user must log in and listen for xyz number of hours to keep account active.

BTW, I honestly think that recent music is just load of crap. My father always used to tell me during my teen days, you will listen to what I am listening now and what you are listening now, you will not be able to listen to after 10 years. He was soo true.
Today's headlines
Suspected Ebola case ruled out in Sweden
Photo: Fredrik Sandberg/TT

Suspected Ebola case ruled out in Sweden

UPDATED: Officials at a Stockholm hospital reported that they had found a suspected case of the Ebola virus on Sunday night. The case was dismissed, however, on Monday. READ  

Skåne floods
Huge clear up underway after Skåne floods
A Malmö bus under water. Photo: Stig Åke Jönsson/TT

Huge clear up underway after Skåne floods

Flood waters subsided in the southern Sweden region of Skåne on Monday, after flash flooding saw chaos on roads and trains at the weekend. READ  

Elections 2014
Sweden's Alliance reveals full manifesto
Photo: Henrik Montgomery/TT

Sweden's Alliance reveals full manifesto

UPDATED: Leaders of the Moderate Party, the Centre Party, the Liberal Party and the Christian Democrats have announced their complete list of election promises in Stockholm's Nacka. READ  

Man shot dead in hunting accident
Photo: Hunter Desportes/Flickr

Man shot dead in hunting accident

Police in northern Sweden say a man was killed on Monday morning after what they described as a "hunting accident". READ  

Zlatan scores hat trick in PSG thrashing
Photo: AP

Zlatan scores hat trick in PSG thrashing

Champions Paris Saint-Germain thumped Saint-Etienne 5-0 as Bordeaux saw their 100 percent record at the start of the Ligue 1 season ended on Sunday with a 1-1 draw against Bastia. READ  

Flash floods cause chaos in southern Sweden
A car in Malmö on Sunday. Photo: Stig-Åke Jönsson/TT

Flash floods cause chaos in southern Sweden

The Skåne region of southern Sweden was hit suddenly by extreme rains on Sunday morning, with houses flooded, buses evacuated, and people having to swim to safety from their cars. READ  

Fit-again Ibrahimovic set for PSG return
Photo: TT

Fit-again Ibrahimovic set for PSG return

Zlatan Ibrahimovic is set to make his comeback for Paris Saint-Germain against Saint-Etienne in Ligue 1 on Sunday after two weeks on the sidelines with an abdominal muscle injury. READ  

Military raises readiness level over Ukraine
Swedish soldiers in Afghanistan. File photo: Magnus Lindstedt/Armed Forces

Military raises readiness level over Ukraine

The Swedish military said Saturday it had increased intelligence gathering and called in extra staff to its headquarters over the crisis in Ukraine, as the prime minister compared Russia's current behaviour with the Cold War. READ  

Police injured in anti-Nazi protest in Stockholm
Police and demonstrators on Saturday. Photo: Fredrik Persson/TT

Police injured in anti-Nazi protest in Stockholm

Swedish police said three officers were injured Saturday as they faced a crowd of thousands protesting against a neo-Nazi rally in central Stockholm. READ  

Boy receives cancer vaccine by mistake
Photo: Hasse Holmberg/TT

Boy receives cancer vaccine by mistake

A boy scheduled to be vaccinated against mumps, measles, and rubella instead received a vaccine against cervical cancer. His family has now reported the blunder for inspection. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Tech
Sweden's highest peak to lose title next year
Politics
How immigration became a key election issue
Society
Brit's life in Sweden becomes BBC radio show
Gallery
People-watching August 27
Gallery
Top ten false friends in Swedish
Blog updates

25 August

Hit och dit, här och där (The Swedish Teacher) »

" Hej igen! A common challenge for Swedish language students are the location adverbs hit/här, dit/där, hem/hemma etc. Some of the location adverbs come in two versions. We should use one type of location adverb when we use a verb describes where we are, and we should use the other type of location adverb when we the verb..." READ »

 

25 August

The Dollar Store (Blogweiser) »

"A dollar store in Sweden. Blog post: http://t.co/tNuuvcP1q0 #USD #greenbacks #sweden #sverige pic.twitter.com/RHFAYf7U1k — Joel Sherwood (@joeldsherwood) August 23, 2014 There’s a chain here in Sweden called The DollarStore. This name always stood out to me in a country where they don’t use dollars. I went there for the first time this weekend. They actually accepted greenbacks..." READ »

 
 
 
National
Roma advocate scoops Wallenberg prize
Society
Meet the man who made a Swedish store recall its high heels for kids
Business & Money
'How I came to run my own business in Sweden'
Politics
Expert explains why Sweden's election oozes uncertainty
National
City plays Schindler's List theme at Nazi rally
Society
For Stockholm Fashion Week, here's the A-Z of Swedish fashion
National
'Amnesiac' man avoids deportation for ten years
Gallery
Princess Estelle through the years
Business & Money
Swedish city all set for six-hour workday trial
Business & Money
Five golden rules for the Swedish job hunt
Sponsored Article
Graduates: Insure your income in Sweden with AEA
Gallery
People-watching August 22-24
National
Armed royal guards caught (very) drunk on the job
National
Sweden orders textbook on Roma discrimination
Gallery
Violent anti-Nazi demonstrations in Malmö
Society
A closer look at Sweden's five official minority languages
Gallery
See the destruction from the southern Sweden floods
Politics
'Sweden Democrats hold the key to elections'
Society
Swedes celebrate first day of smelly fish season
Sponsored Article
Find out what gives this Swedish school executive appeal
Sponsored Article
Introducing...Your finances in Stockholm
Sponsored Article
Introducing...Housing in Stockholm
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

746
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
http://psdmedia.se