Warner Music has revealed that it plans to stop licensing songs to free online streaming services. Warner Music’s chief executive, Edgar Bronfman explained the decision saying providing free music is “clearly not positive for the industry”.
A Warner Music spokesman later confirmed that the change in policy will not affect current deals meaning the label’s large catalogue will remain available on sites like Spotify and We7 for the time being.
But Warner Music’s contracts aren’t permanent and if it does not believe in ad-supported services like Spotify, it’s likely that it will not opt to continue them.
Warner Music is the third biggest record label in the world. It posted a loss of $17m in the last quarter of 2009 even as its digital sales grew by 8%. Bronfman was critical of Spotify, increasing speculation that the label will eventually ditch the streaming service:
“The ‘get all your music you want for free and then maybe with a few bells and whistles we can move you to a premium price strategy’, is not the kind of approach to business that we will be supporting in the future.”
The initial media response to Bronfman’s comments was to claim that Warner Music was immediately pulling out of its deal with Spotify.
Daniel Ek, Spotify’s head honcho, took to Twitter to dispute the claims: “I’m in US atmo. To be clear; WMG are not pulling out of Spotify. Media is taken things out of context. So don’t worry – be happy 
”
Ek may claim to be happy now – and Spotify’s subscriber numbers are growing and it’s adding new features like Similar Artists – but if other labels follow Warner Music’s lead in criticising the service, he might not be smiling for much longer.
Out now | from £free | Spotify
