You will be redirected back to your article in seconds

Spotify Clocks 20 Million Paid Subscribers, Raises $526 Million

It’s on: Spotify has raised a massive $526 million round of funding to fight of Apple’s new Apple Music subscription service, according to a Wall Street Journal report.

The new funding comes from a large number of investors including TeliaSonera AB, Goldman Sachs via its Global Private Opportunity Partners fund and British as well as Canadian hedge funds. It brings the total amount raised by Spotify thus far to more than $1 billion, and comes at a valuation for the company of $8.53 billion, according to the Journal.

Spotify didn’t comment on the funding, but revealed some new milestones Tuesday: The music service now has 20 million paying subscribers and 75 million monthly active users. This means that Spotify doubled its paid subscriber base since May of 2014.

Spotify also announced that it has paid a total of $3 billion in royalties since the launch of the service in 2008, and the pace of payouts is accelerating: In the first three months of 2015, it paid $300 million in royalties, the company said.

In the context of the Apple Music launch, those numbers aren’t just growth metrics: They can also be seen as a validation of Spotify’s freemium model. Spotify is offering users free and ad-supported streams as a way to get them hooked and eventually convert them to its paid tier; Apple Music, on the other hand, doesn’t have such a free tier.

Some in the music industry have argued that Spotify should follow Apple’s lead and curtail its free offering, prompting regulators to look into the possibility that Apple colluded with record labels to force competitors to end its free tier.

More Digital

  • Blockchain Mania

    AFM: Panel to Launch Blockchain Working Group for the Film Industry

    A group of film executives and tech industry entrepreneurs are to establish a working group seeking to plan how blockchain technology should be applied to the creative industries. The call will be made at the American Film Market on Tuesday in Santa Monica by Manuel Badel from Badel Media and Patrice Poujol from The Lumiere [...]

  • Magic Leap Raising Another Funding Round

    Magic Leap Is Raising Another Big Funding Round

    Augmented reality startup Magic Leap is raising even more money. The company is currently in the process of raising its Series E round of funding, a spokesperson told Variety on Monday. Magic Leap previously raised around $2.6 billion, including $280 million from NTT Docomo in April. “Magic Leap is in the midst of a significant [...]

  • hearst logo

    Hearst Magazines Unionizes With Writers Guild of America East

    The Writers Guild of America East has scored a major victory by unionizing Hearst Magazines’ editorial, video, design, photo and social staff across 24 digital and print brands. The New York-based WGA East, which has about 6,000 members in film, television, news and digital media, announced on Monday that a strong majority of the 500-member [...]

  • Apple AR Headset Coming in 2022:

    Apple Said to Prep AR Headset for 2022

    Apple’s augmented reality (AR) headset won’t be arriving on store shelves until at least 2022, according to a new The Information report. The iPhone maker reportedly updated a large number of employees about the project last month, filling the spacious Steve Jobs Theater on its Cupertino, Calif. campus with employees working on AR hardware. Apple [...]

  • Variety Launches New Video Series, 'Daily

    Variety Launches New Video Series, 'Daily Variety'

    Variety has launched a daily video series covering the business of entertainment. Hosted by Audrey Cleo Yap and executive produced by Eva Wong, “Daily Variety” will feature breaking news coverage and analysis from Variety’s award-winning staff as well as in-depth features and interviews with top industry professionals. Each bite-sized segment and featured clip will be [...]

  • Pluto: Vevo Stations Launching on Ad-Supported

    Channeling MTV, Vevo Launches Linear Programming on Pluto

    Music television is back: Major label-owned music video platform Vevo is launching a series of linear channels for leanback viewing on Pluto TV, the ad-supported video service that got acquired by Viacom earlier this year. A first channel, dubbed Vevo Pop, will launch on November 12; additional channels, including a holiday-themed station, are expected to [...]

  • Instagram tests hiding likes

    Instagram Will Begin Hiding Likes in the U.S.: Smart Move or Misguided Fail?

    Instagram is about to launch a test of removing like counts from posts in the U.S. — and, predictably, the idea has been met with a range of reactions ranging from praise and support to concern and mockery. The hope is that the change can reduce anxiety among Instagram users, to make social media less [...]

More From Our Brands

Access exclusive content