Spotify has recently introduced an access paywall on its platform for the lyrics of the songs. A decision like this one seems to be part of a more general strategy to turn around free users into paid subscribers into Spotify Premium, which recently already had a price surge on its monthly subscription. The first change had been noticed last fall when non-paying users denied access to lyrics and gave them a message encouraging to subscribe to Spotify Premium. A spokeswoman at the time described the measure as only a test and limited to a few markets.
Their language, though, had changed, and what was a "test" now seemed to be a permanent feature for Spotify's business model.
It was made under somewhat mysterious circumstances and without even a whisper from the company, as no announcements were made of this change. This move can actually be inferred as an attempt to give the subscription count a push. Though Spotify succeeded in having a number of users above 600 million monthly active users and posting growth in paid subscriptions with a large percentage of 15% year-on-year, the most recent quarterly revenue outcome fell short of market expectations. Spotify would be tempted to do that with such numbers in mind.
The effectiveness of such a move, however, seems doubtful. The lyrics are available to users for free via a variety of other services, including Genius, Apple's Shazam, Musixmatch, and others. They are not exclusive properties of Spotify. This access would threaten Spotify's ambition to allow lyrics to be one of the motivators to make customers pay for the subscription to the Premium service.
The reaction was kind of polarized when Spotify announced that it would start monetizing the lyrics. In a very optimistic view, it can be taken as a business move where Spotify has found itself targeting a very popular feature to force more users into becoming paid users. The other risk is to lose a good part of the user base of Spotify, which is used to benefiting from the service for free and may think of this as a devaluation.
An interesting point to consider in the future, since it would be interesting to see whether Spotify's new policy actually has any effect on further growth and, on the other hand, if the uproar in the community possibly does really force some kind of reconsideration of the strategy. This means that the music streaming business exists within a very competitive domain and how such players as Spotify strike the balance between monetizing content and not compromising the user experience will determine success. This is a recent and risky change, but only time will show the fruits of it for Spotify. Perhaps users will pay up; maybe it will just push them towards alternative platforms that have richer free experiences.
