Spotify launched in the Netherlands today (May 18). It's the seventh market where the ad-funded streaming music service is active, following launches in the U.K., France, Spain, Sweden, Norway and Finland.
The Stockholm and London based company struck a deal with Dutch collecting society Buma/Stemra, alongside its existing Europe-wide deals with the four major record companies as well as many indies.
The deals also include local repertoire, which country manager Tobias Edström reckons is important for the success of the service in Holland. Spotify claims it offers a total of 8 million tracks.
To celebrate the launch, Spotify offered an exclusive listen to the brand new single by two of Holland's biggest male artists: Marco Borsato and Guus Meeuwis. Their duet "Schouder Aan Schouder" (Shoulder To Shoulder) can be listened to ahead of its formal release on May 21.
Spotify also launched two new service options: Spotify Open, a free, ad-supported version which can be used for up to 20 hours a month without the need for an invite, and Spotify Unlimited which offers ad-free access on a computer for €4.99 ($6.20) per month.
These complement the existing Spotify Free and Spotify Premium offerings: Spotify Free provides ad-supported music that users can sign up to by obtaining an invite. Spotify Premium offers ad-free access on both computer and mobile phone for €9.99 ($12.40) at double the audio quality (320 kbps). This service can be used online and offline and comes with exclusive content and offers. Users can also pay for and download individual tracks via download partner 7digital.
By March, 320,000 of Spotify's 7 million users had converted to a Premium account. With the introduction of the Unlimited service Edström expects the proportion of free users upgrading "to increase significantly."
Spotify's main focus is extension into new territories, Edström says. "We invest a lot of money to get the service to as many countries as possible. This year we should open in the U.S., one of the biggest music markets. Once we achieved that, we'll be focusing on profit," he tells Billboard.biz.
Tobia Edström runs the Dutch operation from an office in Amsterdam. "Many technical and back end facilities will be handled from Sweden, but we do need sales people in the different countries," Edström says. He has already employed a sales director and an account director.
Asked why Spotify picked the Netherlands as its next territory, he says: "When making such a decision, we look at the online market, Internet penetration and music interest. In our opinion, the Dutch market is very healthy in those respects."
Edström calls Spotify "a superior, legal alternative to the illegal exchange of music."
"Our biggest competitor is piracy," he says.
Performing rights society Buma receives a percentage of the income from Spotify, based on ads and subscriptions.
"For Dutch rights holders it's very important Spotify becomes a success, as it is a legal initiative to illegal downloading," says Buma spokeswoman Antoinette de Ridder.