Spotify the music streaming application on Tuesday signed a deal with Universal Music Group. The deal now lets the artists release their new albums exclusively on Spotify's paid service for the first two weeks.
Spotify and Universal Music Group sign an exclusive deal
This deal might be a life saver for them, as its rival Apple Music is steadily eating into its share. A few artists have boycotted the application and moved to Apple Music due to its free service that Spotify offers. The company is yet to post a profit as it expands. And thus needs to show the investors that it can generate a steady cash flow.
The multi-year contract that both the companies have signed would make Spotify a much more attractive platform for the Universal Music Group's artists like Taylor Swift, Kanye West, Lady Gaga, Coldplay, Adele, and much more.
Spotify also said that this deal also covered, that they would have to collaborate with Universal Music on marketing campaigns and would also give them unprecedented access to all their data.
The company refused to comment further and did not disclose any fee structure or duration for the contract.
Quote on the deal
We know that not every album by every artist should be released the same way, and we've worked hard with UMG to develop a new, flexible release policy, Universal artists can choose to release new albums on premium only for two weeks, offering subscribers an earlier chance to explore the complete creative work, while the singles are available across our platform for all our listeners to enjoy.
Daniel Ek, Chief Executive officer Spotify.