Spotify Expands into Russia
In July 2020, Spotify launched its service in thirteen new markets across Europe, including Russia. Why is this big news? Russia is currently the 17th largest streaming market in the world and is on track to be the 10th largest streaming market in the world by 2030 — 87% of Russia uses streaming as their primary form of music consumption versus 61% globally and 68% in the U.S. A few other countries that were included in the launch were Albania, Montenegro, Serbia, Croatia, and Ukraine. It is estimated that this launch will allow 250 million fans to start discovering music through the Spotify platform based on their streaming habits. Not only will this expansion connect listeners through the platform, but it will give artists an opportunity to post their content on the platform and connect with a global audience. To welcome Russia and the other countries to the platform, Spotify curated over 200 playlists featuring European artists, 100 of those playlists featuring Russian artists.
The fact that Spotify has launched successfully in Russia is major news as the company had attempted to launch in Russia back in 2015, but wound up pulling out. The major issues that caused the company to retract its plan to launch in Russia were the economic crisis, a hostile political environment, and new laws that governed internet usage. When expanding into international markets, companies often face legal challenges that they must work through to enter, and most of the time they will if they believe that the ROI of the market will exceed the challenges. This was not the case for Spotify in 2015 as the country was experiencing a financial crisis as their currency, the ruble collapsed. With the combination of legal challenges, financial challenges, and political turmoil, Spotify decided that it was the perfect storm that they wanted no part of and pulled out. Thankfully, the country has recovered and Spotify was able to have a successful launch!
I don't believe that they could have done anything ‘better’ than they did as they called this the “most successful new market launch [for the company] to date” and this launch increased the platform’s total users from 248 million in 2019 to 320 million users this year after the launch. Spotify has significantly more users than its two major competitors — Amazon Music and Apple Music. As of January 2020, Amazon Music reported having 55 million customers and Apple Music reported having 60 million subscribers. Neither of these platforms, however, offers a free subscription option, thus making Spotify ideal for those who do not wish to pay a subscription fee.
