If Spotify retains rising at its present charge, it’ll have a billion international customers by the midpoint of 2027.
That was one in every of MBW’s main takeaways from the agency’s Q1 2023 quarterly earnings at present (April 25), which confirmed that SPOT’s month-to-month lively consumer (MAU) depend hit 515 million on the finish of March this 12 months, up by 26 million quarter-on-quarter.
As defined by Spotify CEO, Daniel Ek, on the agency’s name with analysts this morning, that QoQ development in customers was the second largest in Spotify’s historical past, second solely to This fall 2022, when it added 33 million MAUs.
The agency’s common quarterly internet addition of MAUs over the previous six months, then, is +29.5 million… an annual run-rate of +118 million MAUs per 12 months. Spectacular.
One other takeaway from Ek’s name with analysts at present?
Spotify is taking considerations in regards to the affect of AI-generated music on leisure rightsholders significantly.
Final week, the controversy round using AI in music reached a boiling level after the emergence of a monitor that featured AI-generated vocals copying the voices of Drake and The Weekend.
The monitor was subsequently deleted by platforms – together with Spotify – after a profitable copyright declare was issued by Common Music Group.
Whereas the ‘pretend Drake’ monitor was nonetheless accessible on Spotify final Monday (April 17), UMG responded, publicly stating that “[streaming] platforms have a elementary authorized and moral duty to stop using their providers in ways in which hurt artists”.
It’s a message that Daniel Ek seems to have heard loud and clear.
The exec was requested on Spotify’s Q1 name at present in regards to the “copyright pushback from a number of the main labels” with reference to using AI in music, within the context of Spotify launching its personal AI-powered customized DJ service.
Ek was cautious to distinguish Spotify’s AI DJ from the broader AI dialog because it pertains to copyright, noting that on the “AI DJ… we’ve had nothing however constructive reactions from throughout the business”.
He then tackled the elephant within the room.
“[Spotify] is working with our companions … in attempting to ascertain a place the place we each permit innovation, however to guard the entire creators that we’ve on our platform.”
Daniel Ek, Spotify
Mentioned Ek: “[T]he AI pushback from the copyright business, or labels and media corporations, is admittedly [concerned with] points like ‘identify and likeness’, what’s an precise copyright, who owns the appropriate to one thing the place you add one thing and declare it to be Drake [when] it’s actually not, and so forth. These are authentic considerations.”
Ek then confirmed that “clearly, these are issues [Spotify is] working with our companions on in attempting to ascertain a place the place we each permit innovation, however on the identical time, shield the entire creators that we’ve on our platform”.
Ek’s affirmation got here after emails emerged, by way of the Financial Times, that had not too long ago been despatched by Common Music Group to streaming companions together with Spotify in March, wherein the main wrote: “We’ve got change into conscious that sure AI programs may need been skilled on copyrighted content material with out acquiring the required consents from, or paying compensation to, the rightsholders who personal or produce the content material”.
An unnamed “individual conversant in the matter” informed FT that UMG had been issuing takedown notices “left and proper” towards AI-generated tracks that infringed on copyright.
Ek’s feedback additionally comply with these of one other music streaming firm CEO as regards to synthetic intelligence.
Talking on his firm’s FY 20222 earnings name on March 1, Jeronimo Folgueira, Chief Government Officer of Deezer, stated: “I’m supportive of being stricter by way of what we permit to get uploaded to the platform, and the standard of the catalog.”
He added: “Particularly… when machine-generated music actually takes off… I feel that’s one thing we have to deal with and deal with, and that’s one thing we’re doing with the labels.”
“I don’t assume I’ve ever seen something like [AI] in know-how, how briskly innovation and progress is occurring.”
Daniel Ek
Elsewhere on Spotify’s earnings name at present, Daniel Ek famous that with reference to AI’s relationship to music, “that is very early days and it’s an extremely quick growing house”.
Ek added “I don’t assume I’ve ever seen something prefer it in know-how, how briskly innovation and progress is occurring in all of the actually cool and scary issues that persons are doing with AI for the time being.
“But it surely’s vital, on the chance aspect, not only for Spotify, however for our total inventive ecosystem, the query round copyrights and who owns what copyrights and what the honest manner could be to attribute worth if you’re doing issues in identify and likenesses conditions or impressed by a sure artist, and so on.
“I feel the entire business is attempting to determine that out and attempting to determine [AI] coaching. I’d positively put that on the chance account as a result of there’s numerous uncertainty for your complete ecosystem.”
As reported on Tuesday (April 25), the music streaming firm added 5 million internet Premium subscribers to its consumer base in Q1 2023 (the three months to finish of March), taking its whole international paying subs viewers to 210 million.
These 210 million subscribers marked Premium Subscriber development of 15% YoY, and was 3 million above the corporate’s steerage for the quarter.Music Enterprise Worldwide
