To see how the company is faring on this front Spotify regularly researches piracy rates in countries where they enter the market. Thus far the results have been rather positive.

In 2012 the streaming service entered the Australian market and Spotify’s own research now shows that music piracy via BitTorrent dropped significantly during the following year.

In a keynote speech at the BIGSOUND music conference today, Spotify’s Director of Economics Will Page reveals that the volume of music piracy has decreased 20% between 2012 and 2013. Similarly, the number of people sharing music via BitTorrent in Australia has gone down too.

“It’s exciting to see that we are making inroads into reducing the music piracy problem within such a short space of time in this market,” Page says.

“It shows the scope for superior legal services (offered at an accessible price point) to help improve the climate for copyright online,” he adds.

Spotify shared the graph below with TorrentFreak, showing that the drop in downloads was observed between December 2012 and 2013.

While the overall volume is down not all pirates are giving up their habit. The research found that it’s mostly the casual file-sharers who stop sharing, while the hard-core pirates remain just as active as before.

Also worth noting is that interest in illegal music downloads pales in comparison to that of other media. The research found that the demand for TV-shows and movies is four times that of music.

Spotify suggests that it’s partly responsible for the drop in music piracy, but can’t say to what extent. It’s also not clear how the demand for and volume of other forms of piracy changed in the same time period.

Page sees the drop in music piracy as an encouraging sign, but notes that more has to be done. While Spotify’s Director of Economics doesn’t comment on specific anti-piracy proposals the Government has put forward, he does stress that both carrots and sticks are required to address the issue.

“Let’s be clear, Australia still faces a massive challenge in turning around its much talked about media piracy challenge, and it always has, and always will, take a combination of public policy and superior legal offerings,” page says.

“The downward trend in piracy volume and population suggests superior music legal services like Spotify are making a positive impact, and this has proven to be the case in Scandinavia, but it will take both carrots and sticks to turn the market around.”

The research seems to suggest that services like Spotify are reasonably good carrots, but what the sticks look like will have to become clear in the months to come.

Update: We added the graph Spotify shared with us after publication. This shows that there initially was an in increase in piracy, and that the downward trend started a few months after Spotify became available. In part, the company attributes this delayed effect to the relatively slow organic adoption.

Spotify further explains that it “contributed to the decline” thanks to its fair price, great performance and wide availability.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

With the option to stream millions of tracks supported by an occasional ad, or free of ads for a small subscription fee, Spotify offered something that’s more convenient than piracy.

In the years that followed Spotify rolled out its music service in more than 60 countries, amassing dozens of millions of users. This has led to a decline in music piracy rates in a few countries, but the problem is far from gone yet.

Spotify Australia’s managing director Kate Vale told Cnet that one of the company’s key goals is to convert those who still get their music via unauthorized channels.

“People that are pirating music and not paying for it, they are the ones we want on our platform. It’s important for us to be reaching these individuals that have never paid for music before in their life, and get them onto a service that’s legal and gives money back to the rights holders,” Vale says.

According to Vale, the music industry was in part to blame for the surge in piracy during the last decade, as the legal alternatives were lacking.

“Until there’s free, legal and timely ways for people to download content, then they’re going to turn to illegal ways of doing it,” she says.

Today the legal options are there in most countries, but getting people to give up their old habits requires time. According to Vale there are still 2.8 million Australians who pirate music on a monthly basis, sharing a total 1 billion songs a year.

In the years ahead Spotify hopes to convert these people with a product that’s superior to piracy. This would mean more revenue for the music industry, and thus a win-win for all.

“If we can get even half of these people onto Spotify or legal services, it means there’s going to be money back in the industry which is good for artists, streaming services like ourselves,” Vale says.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

This argument has gathered serious momentum in Australia during the past few years, with local consumers regularly criticizing international TV and movie companies for shipping products Down Under months after release and then charging unrealistic prices.

But in a recent opinion piece, the principal analyst at local music royalty collection outfit APRA AMCOS disputed whether the arrival of services like Spotify that give consumers what they want, have actually done anything to reduce piracy rates.

“Music’s had everything everybody now wants for television shows, such as Game of Thrones, for a couple of years: availability, access and a reasonable price. But the piracy issue still has not been solved,” Andrew Harris wrote.

“In fact, results last month from our ongoing national research show that music piracy levels – just as they were almost two years ago – still sit at around the same level as that of movies and television shows.”

Noting that Spotify offers content in Australia at the moment it’s released around the world and does so at one of the best prices, Harris arrives at a familiar conclusion.

“We’ve heard it all before. No matter how loud the minority might shout it in anger as the answer, it’s impossible to compete with free.”

Unsurprisingly that notion doesn’t sit well with Spotify, a company that was designed from the ground up to compete with piracy.

Responding to Harris’s assertions in Australian Financial Review, Spotify Australia and New Zealand chief Kate Vale said that the company’s experiences told a different story.

“We do believe that access, availability and price does contribute and is the answer and we have proven this in other markets across Europe and particularly in Sweden where we have seen a 30 per cent reduction in piracy since we launched about six years ago,” Vale said.

Cracking Sweden was undoubtedly a major feat given the country’s long association with Internet piracy and Vale believes that Spotify now has the right formula to attract the most aggressive file-sharers – and make money from them.

“If you look at the main audience that is on Spotify, a lot of them are former pirates. There are teenagers who have potentially never paid for their music before, and probably never will,” she said.

“If we can get them on to a service that is free but legal, and they are contributing through our advertising on that free tier, then it is giving money back into the industry that they are just never going to get before.”

The ad-supported tier of Spotify is undoubtedly a great incentive to get people to try the service. Globally the company says that it converts around a quarter of free users to premium subscribers but Australia actually tops that with 31%, suggesting that Aussies are happier than most to part with their hard-earned cash in exchange for a good product.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Cassette tapes, recordable CDs and MP3 have all been described as a major threat to artists’ livelihoods, and with the surge of streaming services such as Spotify the broken record continues to play.

Artists in particular have been spewing Spotify hate, claiming that it’s hurting their income streams.

“We don’t need you to do it. No artists needs you to do it. We can build the shit ourselves, so fuck off,” Yorke said a few months ago in one of his many rants.

Not all artists agree with this view though. The Flashbulb, aka Benn Jordan, is coming to Spotify’s defense and urges his fellow musicians to “think before they bitch.”

“Really Thom? You’ve created a legal, royalty paying library of music that will allow me to literally listen to whatever artist I can think of, whenever and wherever I desire to?,” Jordan notes.

“Because that’s the one thing we, the people, the pirates, the innovators, could not do in the last 7 years when we had all the technology in our hands to do it. Our alternative to piracy has been listening to music encoded as YouTube videos, which is so hilariously ass-backwards that I still can’t wrap my head around it,” he adds.

Better Than Piracy

According to Jordan, Spotify is the answer many pirates have been waiting for. A way for people to have a library of millions of songs at their fingertips, and the option to play them on a variety of devices, for a reasonable fee.

“The real bottom line to every single issue in the music piracy debate is that people will turn to whatever is the most convenient, as long as it is affordable. I truly believe that the vast majority of music pirates in the Napster era weren’t raiding the music industry like looters in a riot. They were simply acquiring music in a much more convenient way,” Jordan says.

For millions of people Spotify is a better alternative than piracy. And just as importantly, it also allows artists to get decent compensation for their work.

Why Hate Spotify?

So why are all these artists complaining about the “miserable” compensation they receive from Spotify? According to Jordan, this is in part their own fault, as many artists have signed away most (or all) of their streaming royalties to their record label or distributor.

Another group of artists simply lacks fans. If nobody is listening to your music on a regular basis, it’s not fair to expect a fat royalty check to arrive in the mail every month.

Contrary to the complaining artists, Jordan says that Spotify has been doing very well for him in terms of revenue. In fact, it outperforms the money he receives from most other digital stores combined.

Making a Spotify Living

“I can tell you that Spotify has made me about 30% more than iTunes, Pandora, Amazon, Xbox Music, Google Play, eMusic, Rhapsody, Rdio, Deezer, MediaNet, Simky, Nokia, and MySpace Music combined in that period. Even if you tack on my checks from ASCAP to that long list, Spotify is still ahead,” he says.

Spotify revenue alone now allows Jordan to pay his rent, and the numbers are increasing month after month whereas revenue from other services has remained flat.

“Spotify alone, for the last 9 months or so, has paid for my rent in a 2 floor coach house with garage. But what is predictably notable, is that the numbers for Spotify are growing monthly, and have actually doubled from the first month to the last while sales on other platforms remained the same,” Jordan adds.

The fact that Spotify revenue is growing much faster than other services has two reasons according to Jordan. On the one hand the streaming model generates income from casual listeners who previously used pirated channels.

In addition, Spotify rewards artists who have a loyal and frequently listening fan base, as the payouts are per stream instead of the one-time fee traditional CD and MP3 sales bring in.

As a result, Spotify now allows Jordan to fulfill his dream of being an artist who can focus on creating new music, instead of doing jobs on the side.

“At the end of the day, that additional income has allowed me to almost completely scale back on television composing and concentrate hard, exclusively on writing and recording new material. For the first time in my life, I’m able to be ‘The Flashbulb’ and not have to worry about filling in the income holes to monetarily survive,” he notes.

“So in regards to Spotify, as a completely independent artist who does just about everything himself, the last thing I’m doing is bitching,’ Jordan concludes.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

The notion, that “it’s impossible to compete with free”, sat well with lawmakers and governments, who looked at offerings coming out of The Pirate Bay and thousands of other similar sites and widely agreed that no-one will pay for something if they can get it for nothing.

The massive rise of iTunes well and truly smashed that theory (even if many were slow to admit it) but another project in development not only had plans to compete with free by offering a decent basic service for no cost, but also had eyes on wooing customers into happily parting with their cash to obtain a superior product.

Five years after its launch in its Swedish homeland, Spotify is achieving its aims. Against all the apparent impossibilities of doing business with freeloading cheapskates, the streaming music service is coming on in leaps and bounds and has recently secured a fresh $250m in funding.

Yesterday, in a bid to build stronger bridges with partners, Spotify launched SpotifyArtists, a new information portal designed to enable artists and their support services to better understand and utilize the streaming platform. Interestingly, and hidden away underneath information on the mechanics of the site, comes the clearest statement yet that right from the beginning Spotify’s target market was one inhabited by music pirates.

“Spotify was designed from the ground up to combat piracy,” the company confirms.

“Founded in Sweden, the home of The Pirate Bay, we believed that if we could build a service which was better than piracy, then we could convince people to stop illegal file-sharing, and start consuming music legally again.”

Right from the beginning Spotify founder Daniel Ek held a solid belief that if his service offered a better experience and superior convenience than that being offered by The Pirate Bay, people would jump on board.

And they have. Earlier this year the service confirmed it had amassed a total of 24 million users worldwide, 18 million on their ad-supported service and 6 million paying a subscription.

“A key part of this [success] has been in ensuring that Spotify has a free [ad supported] tier. By offering this free tier, Spotify is able to compete with piracy on cost and bring music consumers into the legal framework,” the company notes.

To back up their belief that offering an initial free service is the key to getting people on board, Spotify cites a number of its active territories that have enjoyed large reductions in piracy rates since the service’s launch.

In Sweden, a market that should be the most difficult to turn around if file-sharing traditions are any barometer, Spotify says that the number of people who pirated music fell by 25 percent between 2009 and 2011.

In Denmark the IFPI reports that 48% of users using streaming services had previously been illegal downloaders. An impressive 8 out of 10 of those have now stopped completely. Norway, a success story documented earlier this year, has seen its piracy rates drop to just one-fifth of their levels four years earlier, with streaming services taking most of the credit.

There can be little doubt that torrent sites such as The Pirate Bay will always have a following, but when services such as Spotify offer their basic services for free, one has to question why people wouldn’t at least try them. At a time when The Pirate Bay is being accused of stagnation by people including former site spokesman Peter Sunde, Spotify is not only innovating but providing a better experience.

Sure, there are arguments about whether artists are getting paid enough, or whether the major labels’ involvement in Spotify will cause it to sour in the years to come, but these aren’t the general concerns of Joe Public. All the music you can eat, for free (or at a fair price if you want tablet and mobile use), is a very good offer by anyone’s standards and something that has been needed for a long time.

Whether it will be good enough to reach the one billion users Daniel Ek hopes for remains to be seen, but Spotify is without doubt the best attempt at understanding and catering to the needs of pirates young and old there has ever been. Not surprising really, considering it was designed that way from the start.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

So who could have imagined then that after its birth five years ago today (during the glory years of The Pirate Bay no less) Spotify would develop into a hugely successful consumer product that has not only proven popular with music lovers around the world, but with pirates past and present.

Against the odds, Spotify has gone beyond turning many dedicated file-sharers into revenue-generating customers, it has made them happy ones too.

Earlier this year Spotify revealed it had signed up 24 million users worldwide, 18 million to the ad-supported service and 6 million to a paid subscription. But as revealed by company founder Daniel Ek, even greater goals are being eyed.

“My goal is to not just convert the 24 million into buying a subscription,” Ek said. “My goal is to get 1 billion using streaming services rather than a piracy service.”

But during the early days in Spotify’s Swedish homeland, a problem persisted. By failing to respond to customer needs a content availability vacuum had formed, and it came as no surprise to Spotify’s Scandinavia CEO Jonathan Forster that sites like The Pirate Bay were thriving.

“It is a society that loves music and when the internet exploded it was no surprise that it took place in Sweden. In the absence of a legal service, people used whatever was available,” Forster told Metro today.

But despite a huge customer base in waiting and a dream of luring people away from unauthorized sources en masse, Spotify faced problems with the labels.

“When I started at Spotify and realized that we really had not even talked to any of the majors, I felt that this would be difficult,” Forster explains.

So Spotify embarked on a mission to convince the record companies that making their catalogs available on an ad-supported basis would be the way to go. However – and perhaps unsurprisingly given the track records of some of their countrymen before them – they were instead treated as if they were creating a piracy service of their own.

“[The labels] were very polite, but utterly amazed at what we wanted to do,” Forster recalls. “In their eyes we were just a bunch of Swedes who wanted to take their music and give it away for free. We were no different than the people behind the Pirate Bay for them.”

But Spotify refused to give in and two years later the company netted its first license agreements and is now promoted heavily by the labels. According to Rasmus Fleischer, former Piratbyran member and author of award-wining thesis “The music’s political economy,” some of Spotify’s success in Sweden can be attributed to the entertainment companies’ legal victories against The Pirate Bay and the streaming service’s reputation for stirring things up.

“On a symbolic level, it was incredibly significant,” Fleischer says. “The history of Spotify has been built in the Swedish press and media as a rebel company that has rebelled against an outdated recording industry.”

The art of rebellion against the entertainment industries was perfected by The Pirate Bay during the last decade and as a result the site made itself some dangerous rivals. But interestingly while the most powerful forces in the world have failed to take it down, it’s companies like Spotify that could end up becoming its most serious adversary yet.

That, however, will rely on the company maintaining its rebellious streak, positive image and excellent product at a fair price. It will be interesting to see if it can keep that up.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Users who install the extension have the option to download any song on Spotify web player by double-clicking on a track.

Upon publishing the extension still appears to work, but it’s highly doubtful that it will stay online for long. Last year Google cracked down on many YouTube rippers because of terms of service violations.

Tweakers notes that Spotify currently reports “issues with its website” on Twitter but it’s unclear whether this is related.

Ripping music from music sites and services is nothing new of course, but this is the first time we’ve seen such a straightforward option for Spotify.

Update: And…. It’s gone

Update: Tweakers reports that Spotify fixed the “leak”

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

]]> https://torrentfreak.com/chrome-extension-downloads-music-from-spotify-web-player-130507/feed/ 26 https://torrentfreak.com/music-piracy-continues-to-decline-thanks-to-spotify-110928/ https://torrentfreak.com/music-piracy-continues-to-decline-thanks-to-spotify-110928/#comments Wed, 28 Sep 2011 11:52:45 +0000 http://torrentfreak.com/?p=40642 Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

]]> When Spotify launched their first beta in the fall of 2008, we branded it “an alternative to music piracy.”

Having the option to stream millions of tracks supported by an occasional ad, or free of ads for a small monthly fee, Spotify appeared to be serious competitor to music piracy. Data just released by the Swedish Music industry appears to support this theory.

Through quarterly surveys researchers have polled the music consumption habits of thousands of Swedes between the age of 15 and 74, and in their most recent report they find that music piracy continues to drop.

Since 2009 the numbers of people who download music illegally has decreased by more than 25 percent, and over the last year alone it dropped by 9 percent. The data further suggests that this downward trend is caused by the availability of improved legal services such as Spotify.

When Spotify opened up to the public early 2009, it took only three months before the number of Spotify users had outgrown the number of music pirates. In the months after that the number of downloaders continued to decline while Spotify expanded its user base.

playing in Spotify..

Streaming services such as Spotify are now the most popular way to consume music. More than 40 percent of the participants in the survey now use a music streaming service, compared to less than 10 percent who say they download music legally.

About 23 percent continue to pirate music, but this number is dwindling.

“The long-term trend is a sharp increase in legal streaming while we see a reduction in illegal file sharing and downloading,” Music Sweden’s CEO Elizabet Widlund said commenting on the results.

“When 800,000 Swedes are willing to pay for streaming music, there is clearly a market for more legal players in the digital music market. We encourage diversity of music services as it will provide better conditions for both those who create music and those who listen to it,” she added.

Looking at the motivations for people to switch to legal services, participants in the survey cited “the range of music that’s released” as the primary reason (40%). Other explanations were the absolute increase in available music (30%), and the fact that legal services have become cheaper (24%) and simpler (24%).

Although the above is certainly good news for the music industry, it has to be noted that the ‘change’ to legal services is ‘fragile.’ The survey shows a slight change in the ongoing trend during the second quarter of 2011, exactly when Spotify announced that its free service would have some new limitations.

Although this change motivated some (15%) to sign up with a paid Spotify account, the majority (31%) said they would leave Spotify to turn to other streaming services, like YouTube, or file-sharing sites.

There is no doubt that, unlike music industry bosses have claimed in the past, there are indeed ways to compete with free. However, time is needed to find the right balance between giving music fans what they want, and secure a healthy revenue stream.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

]]> https://torrentfreak.com/music-piracy-continues-to-decline-thanks-to-spotify-110928/feed/ 79 https://torrentfreak.com/spotify-coming-to-the-us-110706/ https://torrentfreak.com/spotify-coming-to-the-us-110706/#comments Wed, 06 Jul 2011 21:00:31 +0000 http://torrentfreak.com/?p=37299 Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

]]> Today the music streaming application Spotify announced that it will be available to U.S. users soon.

When Spotify launched their first beta in the fall of 2008, we branded it “an alternative to music piracy.”

Having the option to stream millions of tracks supported by an occasional ad, or free of ads for a small monthly fee, Spotify appeared to be serious competitor to music piracy.

In the two years that followed Spotify rapidly won the hearts and minds of many music fans, but the more than 10 million users come from a few European countries only.

This is about to change according to Spotify.

If you’re from the U.S. and interested in giving Spotify a try, get in line now.

Spotify Coming to the US

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

]]> https://torrentfreak.com/spotify-coming-to-the-us-110706/feed/ 23 https://torrentfreak.com/spotify-a-massive-p2p-network-blessed-by-record-labels-110617/ https://torrentfreak.com/spotify-a-massive-p2p-network-blessed-by-record-labels-110617/#comments Fri, 17 Jun 2011 12:36:42 +0000 http://torrentfreak.com/?p=36276 Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

]]>

What’s often overlooked is that Spotify is in reality one of the largest P2P networks on the Internet. No surprise, since one of the lead engineers from the start is none other than Ludvig Strigeus, the original creator of the BitTorrent client uTorrent. However, not much is known about this private P2P network.

Using P2P technology allows Spotify to use less servers, less bandwidth and have a better up-time. And it appears to be working. In fact, of all the tracks that are streamed over the Internet by Spotify users the majority come via P2P connections. Since they’re dealing with copyrighted music, all transfers are totally anonymous, encrypted and secure of course.

Let’s take a look at some data provided by Spotify on their three main music sources.

As can be seen in the graph above most tracks are played from the local cache. These are songs a user has listened to before, and those files are stored on the local hard drive. Of all the remaining tracks that are played, roughly 80% are accessed via the P2P network.

What’s further notable is that P2P performance is most efficient during peak hours and in the weekend. In the graph provided by Spotify the share of P2P traffic peaks on Saturday evening.

Spotify’s P2P network uses various influences from other file-sharing platforms. It uses both a BitTorrent like tracker and a Gnutella style network, but is specifically tailored towards playing relatively small files. Since it’s dealing with streaming, the first bits of a song are prioritized while slow peers are rejected.

This custom P2P solution guarantees what is one of the most important features of Spotify, a very low latency. Tracks have to start almost instantly, and with a median delay of 265 milliseconds it lives up to this expectation. Quite remarkable for a P2P-powered application.

So finally, there we have it. A massive P2P network that’s fully supported and even partially owned by the music industry. Who ever thought that would happen?

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

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