Oct 10, 2023 1 min read

Spotify adds new restrictions to its free tier in India

Spotify has added some extra restrictions to its free tier in India as it tries to convert more users to its premium service in the market

Spotify adds new restrictions to its free tier in India

Spotify is restricting some of the features available on its free tier in India as it tries to convert more users in the market to premium.

Among other things, the changes mean that free users in India will not be able to rewind, repeat or play tracks in a manual order. In-app messaging will communicate the changes, with the hope - of course - being that some users will be motivated to upgrade to premium. Rather than move to a rival streaming service.

While ad-funded tiers on music platforms are obviously - at least in part - a means of upselling premium subscriptions to users, Spotify has also sometimes talked up its own free tier and accompanying ad sales operation as an important secondary revenue stream and, therefore, a key part of the business in its own right.

However, for the music industry, the priority has always been premium, where it makes much more money. Therefore labels and publishers are always keen to maximise the upsell potential of free tiers.

And while they recognise the value of free to hook in new customers, particularly in emerging markets, they are also keen to see services work hard to convert people to premium products, especially as markets mature. And that often involves adding restrictions to the free tier.

In India in particular, there have been some recent changes of relevance. A key regional service, Gaana, went premium-only last year. And the streaming service operated in the market by TikTok owner Bytedance - Resso - also switched off the free tier earlier this year.

The industry will watch with interest to see if the latest changes at Spotify in India result in an increase in premium sign-ups or a decrease in the service's overall user-base in the country.

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