Smart speakers like the Amazon Echo and Google Home ranges have a significant role to play in Spotify’s strategy. Witness its recent deal to give away a Google Home Mini to all its family-plan subscribers in the US, and its wider ambitions to make its service available on as many speakers as possible. “From what we’re seeing in our data, it’s definitely a rising segment, and it’s a very fast-growing segment for us,” CEO Daniel Ek told analysts in the company’s earnings call last week.
As things stand, though, a premium subscription is a prerequisite to get Spotify running on your smart speaker. Or rather, as things stood: an announcement this morning points the way to Spotify’s free tier also being available on these devices. And, indeed, slightly-less-smart speakers too, since the news relates to Spotify’s ‘Commercial Partners SDK’, and its use by firms making any speaker with the Spotify Connect feature built in.
“Any connected hardware partner will now have the opportunity to use eSDK 3 to allow millions of users to enjoy Spotify Free on their Spotify Connect-enabled speakers,” explained Spotify in its announcement. The company says that its hardware partners will be able to support the free tier in their new devices, but also (via software updates) in their existing speakers.
This isn’t as seismic a change for Spotify as the time in 2013 when it ditched its premium-only policy for its mobile apps (a decision that Ek later said saved the company) but it’s a similar and bold move to bolster Spotify’s free tier – and thus its funnel towards paid subscriptions.
As we said, this isn’t just about the most famous smart speakers, but it’s also fair to say that the significance of Spotify Free on speakers will be much bigger if and when Amazon and Google support it. Research out this week from US firm Consumer Intelligence Research Partners (CIRP) suggests that the smart-speakers install base in the US is now 53m units – 70% of which are Echos and 25% of which are Google Homes.
Remember, though, Spotify’s past signaling of its intentions to make its own hardware. What kind of partnerships and/or resources would it take for the company to make a speaker whose price is free (or as close to free as possible) with out-of-the-box free streaming? A strategy where Spotify isn’t just the new radio, but where a Spotify Speaker literally is a radio-replacement device? That’s a thought for the future: for now, Spotify is firmly focused on partnerships (like its deals with Samsung and Google) to pursue ubiquity in the speakers world.