By Ben Sisario
c.2019 New York Times News Service
Spotify now has 100 million paying users around the world, the company said Monday. But the music-streaming giant stumbled slightly in its recent entry into India, and its profit margins narrowed partly because of an aggressive investment in podcasts.
In its first-quarter earnings report, Spotify said it had 217 million users around the world, up from 207 million at the end of 2018. Of those, 100 million are paying subscribers, compared with 96 million at the end of 2018. Since it went public a little over a year ago, the company said the number of subscribers has jumped 32%, from 75 million in the first quarter of 2018.
In its most recent quarter, Spotify had revenue of 1.5 billion euros, about $1.7 billion. That was a 33% increase from the same period a year ago. It had a net loss of 142 million euros.
The music industry had been anticipating Spotify’s arrival in India for months, and when it finally became available there in February, Spotify proclaimed the move a success, saying it had signed up 1 million users in one week. The company said Monday the figure has doubled.
But Spotify’s arrival in India was marred by music-licensing disputes, a potential sign of coming friction as global music conglomerates seek to maximize income from streaming, now the most popular listening format.
Just as Spotify was set to open in India, Warner/Chappell sued the company, saying it had not secured the proper rights to include Warner/Chappell songs. Spotify set up shop in India anyway, saying its use of Warner/Chappell music was allowed under Indian copyright law. The case remains active in an Indian court.
Spotify hit another roadblock this month when it agreed to remove the content of Saregama, one of India’s biggest labels, after another licensing dispute.
“Warner India is about a global license agreement; it’s not really about India,” said Barry McCarthy, Spotify’s chief financial officer. “And Saregama, we have constructive relationships. We have confidence that will be resolved.”
Spotify has recently joined the podcast boom. In February, the company paid about $340 million for two podcast companies, Gimlet Media and Anchor, and in March bought another, Parcast, for $56 million. Daniel Ek, Spotify’s chief executive, has said “non-music content” will eventually make up 20 percent of the service’s offerings.