On June 30, Apple Music will launch, offering consumers three months free access to its streaming music service.
Spotify can obviously sense danger – and it’s hit back.
The Swedish streaming service is offering potential customers across Europe (including the UK, France and Germany) two months of Spotify Premium… completely free.
Over in the US, it continues to offer new customers three months of Spotify Premium for just $0.99.
All of these promotions carry the tagline: ‘Go Premium. Be Happy.’
The free offer has been running for the past week-and-a-half in Europe and ends on July 5 – conveniently, that’s a week after Apple Music arrives.
Just enough time to do some damage.
Unlike Apple Music, however – which has been castigated by the independent community for offering no royalty compensation – Spotify has established minimum revenue guarantees in place with labels.
That means Spotify can give away Premium accounts till its heart’s content; it will ultimately swallow the financial hit.
Spotify’s two-month free trial is unavailable to those who have already subscribed to Spotify Premium, or who have previously taken a 30-day or 60-day free trial.
Insider industry experts have told MBW that the ‘Customer Acquisition Cost’ value for Apple of its three-month free trial is likely to be in the region of $4.4bn.
Music Business Worldwide