Spotify has established itself in the music industry with its hugely popular music streaming service, which now has 20 million subscribers, of which 5 million pay monthly. But the company had also hedged its bets by also offering downloaded music, thus competing with iTunes and Apple’s Amazon. This is all about to change: the company has discontinued music downloads for all customers, unless they have gift cards with a specific download link, in an effort to “simplify” the service and to âpave the wayâ for new features such as web browsing. .
The change was first reported by Pocket plush, and judging by a scan on Twitter, there was people noting the change in at least two markets, the UK and Sweden. In Sweden, at least one person noticed the change before the new year (and another before Christmas), while in the UK it looks like it just started to take effect on the last day. A glance at the Spotify site indicates that downloading of music has also ceased in other European markets: including Norway, The Netherlands and France – essentially all the markets where it offers downloads. It appears that the United States did not have the download option available to begin with.
Spotify has not given an explanation for the change and has yet to answer our questions.
Update: Spotify responded to confirm the story, and notes that the change was made to “simplify” the service. This does not exclude the reinstatement of the download functionality, developed in-house, again in the future.
âWe recently updated Spotify to further simplify the service and pave the way for new features announced late last year. In-app purchases aren’t part of this update, but we don’t rule out their return. Already purchased credits / gift cards are always redeemable.
It doesn’t seem like all of this affects offline listening for premium subscribers, and those who have downloaded songs keep them as well. I contacted Spotify to confirm these two details.
In the meantime, the following notification will appear when you try to download a track:
The additional details also do not provide an explanation.
In general, the amount of audience reaction seems quite low – perhaps a sign that the service hasn’t been used much compared to Spotify’s streaming option.
We have also now heard a source familiar with the situation confirm this observation: âvery, very few downloads,â we were told. Additionally, the source claimed that the credit system that Spotify operated – these were bundled downloads of 10, 15, 40, or 100 pieces that you could pre-purchase to lower the price of individual downloads – didn’t work to encourage more purchases: “a shit”, according to the source’s own words.
Downloads were powered by 7Digital, until Spotify in 2011 switched to an internal service for better “manage the whole process“.
It’s no surprise that Spotify has instead chosen to focus its resources and energy on its streaming service, which continues to disrupt the overall music selling and downloading business. Some of this disturbance may be too close to the bone, however.
Metallica announced a landmark Spotify streaming deal in December, with a much-loved session between Spotify investor Sean Parker, former Metallica nemesis Lars Ulrich, and Spotify CEO Daniel Ek to commemorate the deal. But since then sales of Metallica’s music have declined – manner down.
According to Billboard:
âBillboard.biz reviewed Nielsen SoundScan data for Metallica’s studio albums for four-week periods leading up to Christmas from 2008 to 2012. Based on catalog performance in previous years, album sales were 15% lower than expected the week the titles were added. Spotify and 35% below expectations the following week. Sales were in line with expectations the week before the titles were added to Spotify. Another way to see the decline in sales of the Metallica catalog is to follow the increase in sales until Christmas. Metallica sales the week before Christmas were 48.8% to 71.1% above the average for the previous three weeks (64.8% in 2008; 71.1% in 2009; 48.8% in 2010; and 53.6% in 2011). But these same albums only increased by 28.5% in 2012. â
There is other evidence that streaming services have cannibalized music downloads and physical sales.
In Sweden, music sales increased 30.1% in the first half of 2012 to reach SEK 446 million ($ 63 million). As part of this, digital music accounted for 63.5% of all sales, with a physical decline of 2.2%, streaming revenue up 79.4%, and downloads down 14%. Streaming revenues in Sweden are already nearly ten times higher than download revenues ($ 40 million compared to $ 4.4 million in the first six months of the year.)