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Spotify Thinks Exclusives Are Bad For Business

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The music streaming service Tidal has consistently climbed the top of the charts in the App Store, a jump that can be linked to the release of two highly-anticipated albums, Rihanna's Anti and Kanye West's Life of Pablo. Although Rihanna's new album is now available on Apple Music and Spotify, Tidal will probably continue to offer albums from popular artists first — especially since we expect Beyoncé will release her new album on husband Jay Z's platform.

While offering exclusives can help bait subscribers (even if it's just for a free trial), streaming rival Spotify believes that offering them is really bad for business.

"We're not really in the business of paying for exclusives, because we think they're bad for artists and they're bad for fans," Spotify's head of communications Jonathan Prince told the Verge. "Artists want as many fans as possible to hear their music, and fans want to be able to hear whatever they're excited about or interested in — exclusives get in the way of that for both sides. Of course, we understand that short promotional exclusives are common and we don't have an absolute policy against them, but we definitely think the best practice for everybody is wide release."

This is a good point, since artists are limiting themselves to the amount of listeners that are exposed to their music. Also, Spotify is the most popular streaming service in the world, with the streaming service reported to reach "nearly" 30 million paid subscribers, after citing it has 20 million paid subscribers last June. That's a whole lot of fans it is reaching.

However, competing against other streaming services, when it comes to new singles or albums being released on other platforms, is nothing new for Spotify. Drake signed a deal with Apple Music, which meant his video for "Hotline Bling" was released exclusively to that platform. This could have actually hurt the rapper since the single could not be identified as reaching number one since Apple Music does not share its steaming numbers.

The current trend of windowed releases, which means a single or album is released first on one platform, then to others, include Adele's latest album 21 as well as Coldplay's Ghost Stories, which were also not offered for Spotify users upon their releases. Many artists are up in arms that Spotify's free tier subscription doesn't pay them as much as its premium service. Artists getting paid for their work is important as album sales continue to decline as the way we consume music continues to move toward streaming services.

Taylor Swift has famously spoken against Spotify for unfair compensation, and Prince previously pulled his music catalog from most streaming services, including Spotify, although he did release a single for Spotify users in the summer.

It's important to remember that the artist's label or publisher pays the artist. Spotify uses a formula based on the percentage of total plays an artist gets to determine their royalties.

It would make sense that Rihanna and Kanye chose Tidal as the platform to release their music, since both own an undisclosed piece of the company.

Exclusives could be bad business for Tidal as well, since many subscribers may not want to continue using the service after the free trial ends. That means fans would not be able to hear new music from Tidal-exclusive artists in the future when they first are released. It could also lead to more illegal downloads, case in point that over 500,000 pirated copies of Kanye's Life of Pablo have been recorded thus far.

Source: The Verge

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