If Spotify retains rising at its present price, it is going to have a billion international customers by the midpoint of 2027.
That was one among MBW’s main takeaways from the agency’s Q1 2023 quarterly earnings at the moment (April 25), which confirmed that SPOT’s month-to-month lively person (MAU) rely hit 515 million on the finish of March this yr, 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 yr. Spectacular.
One other takeaway from Ek’s name with analysts at the moment?
Spotify is taking issues in regards to the influence of AI-generated music on music rightsholders very significantly.
Final week, the talk round the usage of AI in music reached a boiling level after the emergence of a observe that featured AI-generated vocals copying the voices of Drake and The Weekend.
Whereas the ‘faux Drake’ observe was nonetheless obtainable on Spotify final Monday (April 17), UMG responded, publicly stating that “[streaming] platforms have a elementary authorized and moral duty to forestall the usage of 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 the moment in regards to the “copyright pushback from a number of the main labels” with reference to the usage of AI in music, within the context of Spotify launching its personal AI-powered personalised 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 trade”.
He then tackled the elephant within the room.
“[Spotify] is working with our companions … in attempting to ascertain a place the place we each enable innovation, however to guard all the creators that we have now on our platform.”
Daniel Ek, Spotify
Stated Ek: “[T]he AI pushback from the copyright trade, or labels and media firms, is admittedly [concerned with] points like ‘identify and likeness’, what’s an precise copyright, who owns the correct 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 official issues.”
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 enable innovation, however on the similar time, defend all the creators that we have now on our platform”.
Ek’s affirmation got here after emails emerged, through the Financial Times, that had just lately been despatched by Common Music Group to streaming companions together with Spotify in March, wherein the main wrote: “We now have turn into conscious that sure AI methods may need been educated 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 “particular person accustomed to the matter” informed FT that UMG had been issuing takedown notices “left and proper” in opposition to AI-generated tracks that infringed on copyright.
Ek’s feedback additionally observe these of one other music streaming firm CEO with regards to synthetic intelligence.
Talking on his firm’s FY 20222 earnings name on March 1, Jeronimo Folgueira, Chief Govt Officer of Deezer, said: “I’m supportive of being stricter when it comes to what we enable 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 going on.”
Elsewhere on Spotify’s earnings name at the moment, Daniel Ek famous that with reference to AI’s relationship to music, “that is very early days and it’s an extremely quick creating house”.
Ek added “I don’t assume I’ve ever seen something prefer it in know-how, how briskly innovation and progress is going on in all of the actually cool and scary issues that persons are doing with AI in the meanwhile.
“However it’s essential, on the chance aspect, not only for Spotify, however for our complete artistic ecosystem, the query round copyrights and who owns what copyrights and what the truthful manner can be to attribute worth if you’re doing issues in identify and likenesses conditions or impressed by a sure artist, and so forth.
“I feel the entire trade 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 quite a lot of uncertainty for the whole ecosystem.”
As reported on Tuesday (April 25), the music streaming firm added 5 million internet Premium subscribers to its person base in Q1 2023 (the three months to finish of March), taking its complete 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 steering for the quarter.Music Enterprise Worldwide