Spotify Finally Bites The Bullet & Takes Big Dive Into Africa
In 2019, 35 percent of music streaming subscribers worldwide had a subscription with Spotify, making it the biggest music streaming platform in the world. Except that “the world,” in that context, meant 79 countries that mostly exclude Africa.
Spotify has existed for 13 years and in all that time, it’s essentially ignored the African market, barring the isolated launch in South Africa and a handful of North African countries in 2018. All these years, Spotify has basically kept away from Africa’s music streaming scene. Until now.
On Monday, February 22, the Swedish-born company revealed that aggressive plans were already in motion to see it enter 80 new markets in the coming days.
Of those 80 new markets, 39 are countries in sub-Saharan Africa including Nigeria, Kenya, Tanzania, Ghana, and several others. It’s been reported that Spotify has been running extensive tests with a section of beta testers in these countries over the last few weeks.
It does appear that Spotify has finally bitten the bullet, rolled up its sleeves, and taken a dive into a pool that it has long stayed out of for reasons often attributed to “we want to do what makes the most business sense.”
So, why now? It turns out the important question is “why not?” Since launching in 2008, Spotify has risen to become one of the world’s most favourite platforms for streaming music, boasting content and playlists that have made it the choice platform even in countries where it is unavailable.
Yes, all those years, Spotify even managed to accumulate an undocumented but sizeable number of users in places where it is unavailable as users in those places took to virtual private networks (VPNs) to get around the geographical location barriers. Officially, though, Spotify boasts 345 million users and more than 155 million paying users, as of December 2020.
However, in recent times, Spotify has found Apple Music and other global music streaming platforms like Tidal and Deezer breathing down its neck as the competition has intensified and the quest for growth has necessitated a conquest of newer territories. Last year, Spotify’s unspoken arch-rival, Apple Music, made its intentions clear when it launched in 52 new markets, of which 35 are African countries.
It could be said that it was always a matter of time before Spotify forced itself into the fray after sitting on the fence for so long. They all appear to be vying for pole position in Africa’s tricky but potentially lucrative music streaming market where Boomplay claims to be king with 44 million active users, and 25+ other local and international platforms are sparring.
By 2024, Africa’s music streaming revenues are expected to have hit a 12 percent annual growth rate that would see the market reach a volume of USD 822 Mn. With mobile subscribers projected to hit 483 million mobile by 2025, coupled with falling internet costs and a youthful tech-savvy population, music streaming might even see larger growth.
But to get there, there’s a lot of work to be done. Although music streaming is growing in Africa, much of the music consumed in these parts still come through illicit sources.
With global leading music streaming platforms offering their services on the basis of subscriptions charged to users, there are legitimate concerns over the actual proportion of Africans who can spare a sum to pay for music given the dire economic realities. It follows that music streaming companies might have to rely heavily on the ad-supported freemium model as opposed to the premium subscription model.
And then the artists themselves are known to upload their music online for free and instead bank on shows, concerts, and brand endorsements as the preferred income route. There’s also the piracy problem. Hence, music streaming has been slow to take off in these parts.
Add those to the opaqueness around record label deals and music distribution frameworks and there’s the raft of factors that have kept the likes of Spotify out of the picture for so long in Africa. Until now.
In any case, for users that have historically been excluded and had to resort to “creative” methods, Spotify’s expansion means goodbye to VPNs. And for Spotify (and others like it), it’s time to double down as the competition just got a lot more intense.
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