Spotify and Warner Chappell end dispute in India, sign global licensing deal

Manish Singh
NEW YORK, NY - APRIL 03: The Spotify banner hangs from the New York Stock Exchange (NYSE) on the morning that the music streaming service begins trading shares at the NYSE on April 3, 2018 in New York City. Trading under the symbol SPOT, the Swedish company's losses grew to 1.235 billion euros ($1.507 billion) last year, its largest ever. (Photo by Spencer Platt/Getty Images)

Spotify is ending its year-long dispute with Warner Music's publishing firm.

The world's largest music streaming service said on Tuesday that it has inked a global licensing agreement with Warner Chappell.

The announcement marks the end of their litigation before the Bombay High Court, where Warner Music was seeking an injunction to prevent Spotify from using its music in India. Warner Music had claimed that Spotify "falsely asserted a statutory license" in India.

A Warner Chappell spokesperson said the new deal “appropriately values our songwriters’ music and expands our licensed partnership with Spotify to include India.” A Spotify spokesperson said the music streaming business was "pleased" with the outcome.

"In less than a year, millions of Indian listeners have joined Spotify, listening to their favorite artists and songwriters from across the globe. We’re pleased with this agreement, and together with Warner Chappell Music, we look forward to helping songwriters and artists connect with more fans, and for more fans to enjoy and be inspired by their music,” the spokesperson said.

Warner Music, one of the world's top three music labels, had sued Spotify days before the music streaming service was to launch in India, one of the world's biggest entertainment markets. Spotify argued that it was using an Indian rule that permits radio stations to offer songs from Chappell Music.

Spotify went ahead and launched the service in India anyway -- though it did not include a number of Warner Music's titles. To lure users, Spotify introduced a new free tier and unveiled a premium version that cost just $1.40 a month. But the company is struggling to win paying subscribers. According to a Bloomberg report in December, Spotify has fewer than 800,000 subscribers in India.

India is an overcrowded market for music streaming services. Apple Music, Amazon Music, Times Internet and Tencent-backed Gaana, Airtel's Wynk and Reliance Jio's JioSaavn are locked in an aggressive battle and offer nearly identical catalogs. Google also launched its YouTube Music streaming service in India last year.

But the opportunity India offers is massive and perhaps unmatched. More than half a billion people have come online in India in the last decade, thanks in part to the availability of some of the world's cheapest mobile data plans and the proliferation of low-cost Android smartphones. According to an estimate by Cisco, the number of internet users streaming content in India is set to double by 2022.

Last month, Spotify started a campaign for new and existing users in which anyone could sign up for a year-long subscription of Spotify for 699 Indian rupees (~$9.90 -- a figure that Spotify incidentally charges each month in many markets, including the U.S.).

Spotify is involved in another similar lawsuit in India with local music label Saregama, which is seeking the music streaming service to remove 100,000 songs. A Spotify spokesperson in India declined to comment on the lawsuit.