Fresh from launching a streaming music service and appointing a new CEO, electronic-music brand Beatport is announcing a startling new partnership: with Spotify.
Yes, that’s right: the two companies are rivals, but also now partners. The deal will see music and video from Beatport appearing on a new “electronic music destination” within Spotify, including some material that’s previously been exclusive to Beatport.
“From the latest tracks by rising stars in electronic music to video coverage of live events to highly curated playlists from Beatport’s team of experts, the Beatport channel on Spotify will host a variety of premium and exclusive content from the epicenter of electronic music culture,” is how the announcement puts it.
Spotify is set to be the first of a new network of distribution partners for Beatport, according to new president and CEO Greg Consiglio, although Spotify will be the only one whose users get access to the dance brand’s “new music exclusives”.
“They will be the first to access the latest need-to-know exclusive electronic music from Beatport and will also be able to watch to a mix of original festival and event video content,” he said in a statement.
Music Ally understands that the partnership does NOT mean Beatport is shutting down its own streaming service, which launched earlier this year. The company says it is currently adding around 25,000 new tracks a week to its store and streaming service, from more than 43,000 label partners.
The new streaming service, including iOS and Android apps that launched in March, is part of the strategy to diversify beyond Beatport’s history as a dance downloads store. Beatport recently launched an embeddable player for the new service while promising to pay royalties to rightsholders for every stream – moves aimed directly at SoundCloud and its large community of dance artists and DJs.
Parent company SFX’s last financial results revealed that Beatport’s revenues fell from $11.6m in the first quarter of 2014 to $8.9m in the first quarter of 2015 – a 23.3% year-on-year decline.
SFX’s management wants to take the parent company private again, although analysts have this week been expressing doubts about where the necessary funding will come from to buy back the 62.6% of shares in SFX that are owned by external investors.
Meanwhile, one hedge fund, Maglan Capital, suggested that appointing Consiglio as the new Beatport boss this week in advance of the buyout could be a sign that SFX was considering “maybe selling Beatport separately”.
The Beatport partnership looks like it could bolster Spotify’s electronic-music credentials, and perhaps just as importantly its recently-launched video business.
In May, Spotify added a shortform videos section to its mobile apps, with partners including Vice Media, Maker Studios, Comedy Central, the BBC, ESPN, Nerdist, NBC and TED. The company promised a suite of “Spotify Originals” shows too, focusing on music. Beatport’s video content will slot neatly into that roster.
Spotify has historically had strong relationships with some dance artists like Avicii and Tiesto – the latter contributed one of the customised tracks to Spotify’s new running feature recently.
It has also had run-ins with some members of the dance community though, particularly Ministry of Sound, which sued the company for copyright infringement over its playlists. The companies settled out of court in February 2014.