(qlmbusinessnews.com via telegraph.co.uk – – Fri, 25 Aug 2017) London, Uk – –
Spotify has taken a major step towards a public listing after agreeing a long-term licensing deal with Warner Music Group.
The music streaming service’s agreement with Warner, one of the world’s biggest record labels, follows more than two years of negotiations.
“It has taken a while to get here,” said Warner’s chief digital officer Ole Obermann. “But it has been worth it, as we have arrived at a balanced set of future-focused deal terms”.
Spotify has now struck deals with leading record labels Sony, Universal and Warner, and could float on the New York Stock Exchange by the end of the year. It has been reported that the company will not have an initial public offering when it does go public.
Spotify continues to grow ahead of rivals Amazon and Apple, and last month reached 60m paying customers.
However, its net losses more than doubled last year, despite a 50pc increase in revenues, due to a rise in royalty and distribution fees.
The nature of the deal with Warner was not outlined, but it is likely to include concessions from Spotify that allow the labels to restrict certain songs from the service for a limited amount of time.
“Our partnership with Warner Music Group will help grow the new music economy where millions of artists can instantly connect with fans, and millions of fans can instantly connect with artists,” Stefan Blom, Spotify’s chief content officer, told the BBC.
Earlier this year, Spotify bolstered its board by recruiting four new directors ahead of the long-awaited float.
The appointments included former Walt Disney chief operating officer Tom Staggs, who was widely tipped as a future Disney chief executive.
By Sam Dean