Global music streaming platform Spotify’s bet on the Indian market has started to show positive results on the back of higher user adoption in the country.
In the last quarter of 2020, the company added 25 million monthly active users, of which a huge chunk came from India, the US, and Western Europe, the company said in a letter to shareholders. Without disclosing the country-specific numbers, Spotify said its operations in India did better than the company expected.
“India served as a notable source of upside versus our forecast driven by successful marketing campaigns,” it said.
Overall, the Swedish music streaming giant added 74 million users in 2020, registering a growth of 27% year-on-year and taking up its total monthly active users (MAUs) to 345 million. Its paid or premium subscribers stood at 155 million.
While the company added 30 million paid subscribers in 2020, one-third of those users or 10 million came onboard last quarter alone, driven by Europe and North America. In comparison, the company had added 28 million paid subscribers in 2019.
Read this: Global music streaming platforms tune in to capture the India market
Spotify’s total revenue rose by 17% year-on-year to about USD 2.61 billion. While premium segment revenue grew by 15% in the quarter over last year to USD 2.27 billion, ad-supported revenue increased by 29% to about USD 337.8 million.
The company believes podcasts have played a significant role in driving its global growth. Its platform currently has 2.2 million podcasts on its platform, up from 1.9 million in the previous quarter.
“Twenty-five percent of our total MAUs engaged with podcast content in Q4. We continue to see strong growth in podcast consumption, with consumption hours in Q4 nearly doubling since Q4 2019,” it said. “Based on the behavior we see when users first join Spotify, we are confident that podcast usage has been a factor in the accelerated net additions.”
According to the company, user consumption in large regions such as Europe and North America returned to growth,
while Latin America and the rest of the world showed signs of improvement but remained slightly below pre-COVID-19 levels.
To expand its international footprints, Spotify also inked partnership deals with rid-hailing company Grab in Southeast Asia as well as open banking platform Tink and international electrical retail group Euronics in Europe. In India, it joined hands with e-commerce giant Flipkart to offer its shoppers a free Spotify Premium trial for a few months.
A such, Spotify has been sharpening its focus on India over the past couple of years, given the growing appetite of millions of Indian users for music streaming services. The Stockholm-headquartered company competes with bigwigs like YouTube premium, Reliance Jio Saavn, Times Internet’s Gaana, and Amazon Prime Music in the world’s second-most populous country.
To make its service affordable for users and tap the market beyond bigger cities, late last year, Spotify launched a new offering called Spotify Premium Mini. Under this new service, users could opt for daily and weekly plans, priced at INR 7 (USD 0.09) and INR 25 (USD 0.3) respectively, to access select premium features such as ad-free music and the ability to download up to 30 songs on a single phone or tablet.
“Of note this quarter was the launch of Spotify Premium Mini in India and Indonesia, which gives users daily and weekly access to a subset of their favorite Premium features for a lower price as part of Spotify’s commitment to continuously explore new ways to improve our Premium experience,” the company said.