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Gilberto Gil at the opening
party on May 28.
Mia Nygren, Head of Spotify’s Strategic Alliances in
Latin America, being interviewed by Camilo Rocha.
(Swedcham photo)
Fernanda Takai, Marcelo Jeneci and Gaby Amarantos.
(Photo by Fernando Ctenas)
neat package. It certainly isn’t the only service out
there to do so (France’s Deezer and the also Swedish
Rdio are two well-known rivals) but it has become
the most popular and has certainly generated the
greatest buzz in the industry and media. The experience
is simple and straightforward and works great
on a mobile phone. You can either use a free tier,
where ads are played before the songs and there is a
limit to the songs you can access, or you can opt for
a subscription, get rid of the ads and have access to
higher-quality audio (for US$ 9.99 a month).
The platform arrived to help solve an issue that
has eroded record businesses’ revenues for more
than a decade. Between 1999 and 2002, a seismic
change took place in the industry. Thanks to file-sharing
services, lead by the massively popular Napster,
millions of people found out that they no longer had
to pay for music. Almost every single and album ever
recorded was now attainable in the internet through
a free download, even some yet to be released.
In Sweden, it was no different. However, the
Swedes had an extra incentive in the form of a very
fast broadband connection, second only to Japan in
speed according to the Berkman Center, in Harvard.
At the start of the 2000s, 10 megabytes was
already a standard download rate in the country, a
value that is common in Brazil only now.
A natural entrepreneur
Daniel Ek, CEO and Founder of Spotify, was a
teenager at the time and he also was download-crazy.
Born and raised in the Rågsved area in Stockholm, Ek
was a natural entrepreneur. At 14, he started his first
company. According to the Financial Times, by 16 he was already earning
more than his parents combined.
In his early 20s, he landed a job as CEO of uTorrent, the most popular
torrent protocol, a software that facilitates file sharing and downloading.
It was here that he met Ludvig Strigeus, a programmer who
created uTorrent and became the main architect of Spotify.
Around this time, Ek met Martin Lorenzton, who he convinced to start
a company that had the potential to remedy the record industry’s woes.
His idea of a service enabled people to access a song they wished wherever
and whenever they wanted. In other words, he wanted a service that
was as good as the pirates. “For the first time in history, you had a legal
product that was worse than the one you stole,’ he would say.
Ek had a point. Illegal resources for downloading music were efficient
and easy to use. Because of the complicated licensing restrictions, the
legal options’ catalogues suffered. There was nowhere legal where you
could think of an artist and immediately access his music. Most music
streaming services available then had poor selections and even worse
user interfaces. According to Mia Nygren, the platform worked because “it
was a comfortable service and easier to use than the pirate sites.”
One of its most popular features are the playlists, compilations of
songs that users can make or that Spotify itself suggests, based on
activities or mood, as in “Top tracks for a romantic dinner” or “Top 20
workout songs”. There are many “celebrity” playlists to be found on the
platform, by names such as Victoria’s Secret, Rolling Stone magazine
and Disney Pixar. “We have invested heavily in algorithms and human
curators to offer the user what he would like to listen to in the next
minute,” says Diament.
The service has received criticism from some musicians, among them
Thom Yorke, of Radiohead, who believe they receive peanuts money
from copyright related to songs played on the platform. Spotify has
answered such criticism by opening its numbers on a blog and arguing
that the format is still in its infancy and artists will receive more as the
company and adoption of streaming grows.
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