MBW Reacts is a series of short comment pieces from the MBW team. They are our ‘quick take’ reactions – through a music biz lens – to major entertainment news stories.
Spotify has finally launched Audiobooks on its platform.
The addition of the format this week, currently only in the US, comes four months after CEO Daniel Ek outlined SPOT’s intentions to double down on audiobooks during a speech at Spotify’s Investor Day.
SPOT highlighted the opportunity in the audiobooks market at its Investor Day, noting at the time that it’s “expected to grow from $3.3 billion to $15 billion by 2027”.
Starting this week, Spotify listeners in the US will be able to purchase and listen to more than 300,000 audiobook titles on the platform.
US users will see Audiobooks alongside music and podcasts as a section in their library, in search, and in their curated recommendations on Home.
One of the most interesting aspects of the Audiobooks launch on the platform is that access to this content won’t be included as part of a user’s Spotify subscription.
Spotify says that they’ll be displayed with a lock icon on the play button, and they’ll need to be purchased individually in order to listen to them.
Users will need to purchase those gated audiobooks via a web page, and when they return to Spotify, the book will be automatically saved in their library.
The concept of a locked play button, which can be unlocked via an additional purchase, got us thinking. Could this model be applied to artist content on Spotify?
In diversifying its own content offering with yet another audio format alongside music and podcasts, Spotify may have unlocked a new way for artists to make more money from their fans on its platform.
Let’s say, for example, an artist had a bonus track and they wanted to charge extra for it. What if that artist and their team had access to a feature in Spotify for Artists that let them put a lock icon on that track, making it accessible only to the fans who make an additional purchase?
The same could be applied to bonus behind-the-scenes podcasts, deluxe edition albums, or even exclusive music videos, if Spotify ever ventured into this space.
Spotify does offer other ways for artists to generate income on its platform other than royalties from streams, like its Fan Support feature, which was previously called Artist Fundraising Pick. It launched during lockdown when artists couldn’t play shows.
In May, Spotify said that more than 200,000 artists had an Artist Fundraising Pick link at the top of their profile, with about 90% of those artists using that feature to collect fans’ monetary support directly.
Artists can also manage and sell merch on their profiles via Spotify’s Shopify partnership, and Spotify also started selling concert tickets directly to fans last month via its new ‘Spotify Tickets’ site.
But allowing artists to lock individual pieces of audio content, and charge for access to it, could be a new way for Spotify to let artists generate potentially significant additional revenue from superfans.
It’s worth noting here, that last month, streaming and discovery service Audiomack rolled out its new ‘Premiere Access‘ feature, which enables artists to reward their biggest fans with early access to not-yet-officially-released music.
To unlock that access on Audiomack, fans have to become ‘Supporters’ of an artist.
‘Supporters’ is a feature that Audiomack launched late last year, in tandem with partners such as Warner Music Group. It allows fans on the platform to directly monetarily contribute to songs and albums from their favorite artists.
Music Business Worldwide