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Spotify and Universal Music Ink New Deal That Includes Album Windowing

Spotify new[UPDATED] Spotify and Universal Music Group have completed a new licensing deal. The music streamer, which is under month to month agreements, must still get Sony, Warner Music and indie licensor Merlin on board before it can IPO.

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Spotify and Universal Music have finalized a new multi-year licencing deal that included limiting access to some albums to paid premium streaming subscribers, a practice in know in the industry as windowing.  

Daniel-Ek"Starting today, Universal artists can choose to release new albums on premium only for two weeks, offering subscribers an earlier chance to explore the complete creative work, while the singles are available across Spotify for all our listeners to enjoy," Spotify CEO Daniel Ek said in a statement. 

While other details of the deal were unsurprisingly not shared, there appear to be commitments on both sides to use the platform to break new UMG artists.

"We will be working together to help break new artists and connect new and established artists with a broadening universe of fans in ways that will wow them both," said Ek "We know that not every album by every artist should be released the same way, and we’ve worked hard with UMG to develop a new, flexible release policy."

READ FULL TEXT OF SPOTIFY UMG ANNOUNCEMENT HERE.

Sir Lucian Grainge, Chairman and CEO of Universal Music Group had been a vocal critic of exclusives, saying that it hurt fans and UMG would work to end the practice.  But apparently, 2 week windowing, which many at the labels believe could encourage more users to move from free to paid, has his approval

"Today, streaming represents the majority of the business," said Sir Lucian Grainge, Chairman and CEO of Universal Music Group in statement.  Our challenge is transforming that upturn into sustainable growth... To that end, the long-term success of Spotify, and others like it, is essential to the ecosystem’s enduring health. I congratulate Daniel on Spotify’s continued growth and innovation, and I look forward to working together with him and his team to develop exciting new ways to connect artists and fans around the world.”

With market leader UMG on board, expect deals with the other two majors, Merlin and indie distributors to follow in the coming days.

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