If Spotify retains rising at its present fee, it’ll have a billion world 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 energetic person (MAU) rely 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 greatest in Spotify’s historical past, second solely to This autumn 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 critically.
Final week, the talk round using 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.
The observe was subsequently deleted by platforms – together with Spotify – after a profitable copyright declare was issued by Common Music Group.
Whereas the ‘pretend Drake’ observe was nonetheless accessible on Spotify final Monday (April 17), UMG responded, publicly stating that “[streaming] platforms have a basic authorized and moral accountability to forestall 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 among the main labels” with reference to using 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 optimistic reactions from throughout the trade”.
He then tackled the elephant within the room.
“[Spotify] is working with our companions … in making an attempt to determine a place the place we each enable innovation, however to guard the entire creators that now we have on our platform.”
Daniel Ek, Spotify
Stated Ek: “[T]he AI pushback from the copyright trade, or labels and media corporations, is admittedly [concerned with] points like ‘title 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 professional considerations.”
Ek then confirmed that “clearly, these are issues [Spotify is] working with our companions on in making an attempt to determine a place the place we each enable innovation, however on the identical time, defend the entire creators that now we have on our platform”.
Ek’s affirmation got here after emails emerged, by way of the Monetary Occasions, that had just lately been despatched by Common Music Group to streaming companions together with Spotify in March, wherein the foremost wrote: “We’ve got change into conscious that sure AI programs might 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 “individual conversant in the matter” instructed FT that UMG had been issuing takedown notices “left and proper” towards AI-generated tracks that infringed on copyright.
Ek’s feedback additionally observe these of one other music streaming firm CEO with reference to synthetic intelligence.
Talking on his firm’s FY 20222 earnings name on March 1, Jeronimo Folgueira, Chief Government Officer of Deezer, mentioned: “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 tackle, and that’s one thing we’re doing with the labels.”
“I don’t assume I’ve ever seen something like [AI] in expertise, 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 area”.
Ek added “I don’t assume I’ve ever seen something prefer it in expertise, 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 necessary, on the danger facet, not only for Spotify, however for our whole inventive ecosystem, the query round copyrights and who owns what copyrights and what the truthful means could be to attribute worth while you’re doing issues in title and likenesses conditions or impressed by a sure artist, and so forth.
“I feel the entire trade is making an attempt to determine that out and making an attempt to determine [AI] coaching. I’d undoubtedly put that on the danger account as a result of there’s loads of uncertainty for all the 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 world 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
