Spotify in Russia

2023

Liquidation of a legal entity

In December 2023, it became known that Spotify closed a legal entity in Russia.

Roskomnadzor excluded Spotify from the list of companies subject to the law "on landing" due to negligible traffic to the service

In April 2024, Roskomnadzor excluded Spotify from the list of companies subject to the law "on landing," due to the attendance of less than 500 thousand Russian users.

2022

The closure of the office in Russia due to the conflict in Ukraine

In early March 2022, Spotify announced the closure of an office in Russia due to the situation in Ukraine, where the Russian Federation is conducting a special operation. In addition, the service limited access to podcasts of Russian state media, but continued to work in the country.

Our top priority last week was to keep our employees safe and ensure that Spotify continues to serve as an important source of global and regional news at a time when access to information is more important than ever, Spotify said in a statement cited by Reuters news agency.

Spotify closes office in Russia

According to the Swedish newspaper Aftonbladet, citing a letter from the company, Spotify closed its office in Russia indefinitely, but remained available in the country "to ensure a global flow of information."

Spotify's statement also said about "individual support for employees in the region and the global community of Ukrainian employees."

In early March 2022, Russian users faced problems paying for Spotify and Netflix subscriptions. In the case of Spotify, it is impossible to pay with the help of Sberbank and Tinkoff, and Netflix with the help of Tinkoff and Alfa Bank. Tinkoff said Netflix has a problem with the acquiring bank included in the sanctions list. Alfa-Bank also confirmed that this situation arose due to the "sanctions" bank, which is engaged in the transfer of bank data.

At the beginning of February 2022, Spotify shares fell sharply in price (by 16%) after the release of the forecast for subscribers for the first quarter of 2022. The service expects the number of monthly active subscribers to reach 418 million, paid subscribers to 183 million, and revenue of 2.6 billion euros. All these forecasts were slightly worse than analysts' expectations.^[1]

Opening an office in Russia

On February 4, 2022, it became known about the opening of a Spotify representative office. Earlier, the Swedish music service, which is considered the largest in the world, registered a personal account on the Roskomnadzor website. In addition, the company will have to place on its resources a form for the appeal of Russians in order to fully comply with the requirements of the "landing" law, which entered into force on January 1, 2022.

In accordance with this law, foreign Internet companies with a daily audience of more than 500,000 users must open their authorized representative offices in Russia. They should also restrict access to information that will be found to violate Russian law.

Spotify opened an office in the Russian Federation as part of the law on "landing"

For failure to comply with the requirements, they face, among other things, partial or complete blocking, a ban on the distribution of advertising about themselves and the placement of their own advertising by Russian advertisers on such resources, a ban on accepting payments from Russian individuals and legal entities, as well as labeling of content published on the network.

Create a branch, or open a representative office, or establish a Russian legal entity. Executed, - reported on the website of Roskomnadzor regarding Spotify.

The department clarified that by February 4, 2022, the procedures provided for by law and the verification of the documents provided are being carried out. By this day, to one degree or another, six corporations began to comply with the requirements of the law "on the landing" of foreign IT companies: Apple, Twitter, TikTok, Likeme, Viber and Spotify.

Mobile Research Group analyst Eldar Murtazin noted that companies agree to comply with Russian legislation in order to remain on the Russian market. Otherwise, their activities may be prohibited, he added. ^[2]]

2021:7% of Russians pay Spotify

2020

Getting started in Russia

On July 15, 2020, the official launch of the world's largest music service Spotify in Russia took place. It also became available in 12 more countries, including Ukraine, Belarus and Kazakhstan.

In Russia, a subscription to a full package of Spotify Premium services will cost 169 rubles a month, and family access will cost 269 rubles a month. Subscription for students is available at a price of 85 rubles. per month. A new Spotify Premium tariff for two (219 rubles per month) will also appear. It offers an automatically refreshable playlist that combines tracks suitable for both listeners.

The world's largest music service Spotify has earned in Russia

The launch of Spotify in Russia is a big step forward in the implementation of the service's global development strategy. This strategy is based on a single approach to working in world markets and adapting to local tastes and needs of users, "said Ilya Alekseev, CEO of the Russian representative office of Spotify, adding that, according to the International Federation of the Recording Industry, Russia is one of the world's twenty largest music markets.

By the time Spotify was launched in the Russian Federation, the service was adapted for Russian users and offers personal music recommendations:

• "Mix of the Day" of six daily playlists combining favorite music with new tracks;
• "Novelty Radar" is a playlist with new releases by frequently listened to artists;
• "Openings of the Week" is a playlist that takes into account personal musical preferences.

A company representative, in response to a question whether Spotify will store data from Russian users in Russia, assured RBC that they comply with the laws of each country where they work. 

Spotify did not specify how many users the service expects to receive in Russia and how much revenue. A company representative in a conversation with the publication only said that a team was formed in the local office, which created about 100 exclusive playlists specifically for this market and will regularly update them.^[3]

Service launch in Russia postponed due to coronavirus

At the end of April 2020, it became known that the Spotify music service was postponing the launch in Russia due to the COVID-19 pandemic.

2016: Spotify could reach Russia on second attempt

The Swedish music service Spotify is thinking about returning to Russia. This is written by "Vedomosti"^[4], citing sources in several large music labels and media companies.

According to Vedomosti sources, the discussion is at an early stage: "the decision to withdraw has not yet been made, but the company is aware that Russia is a large market with great growth potential."

2015: Spotify drops plans to enter Russian market

Swedish music streaming service Spotify has abandoned plans to enter the Russian market in the foreseeable future. About this "Gazeta.Ru"^[5] told one of the potential partners^[6] the service in Russia. "The service really will not appear on the Russian market due to the unstable economic situation in the country. In addition, according to Spotify management, Russia does not yet have the necessary potential for successful business, "said a representative of one of the companies that planned to work with Spotify.

According to him, in the near future the company may close its Russian office and postpone the launch of Spotify in Russia for quite a long time. Spotify has already fired the head of the company's Russian office, Alexander Kubaneishvili, TASS reports.

As reported by the media, the company was afraid of the political situation and new laws - including a law prohibiting foreigners from owning more than 20% in Russian media.

Also, Spotify's decision not to enter the Russian market could be influenced by unsuccessful negotiations with a number of Russian mobile operators. Spotify management came to the understanding that the standard subscription price would be too expensive for the average Russian, and none of the potential partners wanted to accept part of the costs.

2014

Head of office in Russia appointed

On April 1, 2014, it became known that Spotify Alexander Kubaneishvili would be in charge of the Russian office, two sources in the music market said and his acquaintance confirmed. Kubaneishvili will go to work in April, the interlocutors say. " Sheets Kubaneishvili himself declined to comment.

Kubaneishvili worked for 2.5 years in, Google where he was responsible for advertising business and relations with key partners of the company. Prior to that, he was engaged in online sales in, Microsoft was a sales director at Gigafone Technologies, and even earlier worked at a content provider i-Free and was engaged in business development at MTV Russia. He is a good organizer, a strong sales manager, says Kirill Petrov, managing director of i-Free Innovations. Almost the same characteristic of Kubaneishvili is given by Russia To Europe Vsevolod Leonov, director of partner programs at Google in and Vostochny. Kubaneishvili led a working group at Google responsible for selling advertising to customers from the financial sector consumer market pharmaceutics and luxury goods, Leonov explains.

The exact time of the launch of the Spotify service itself in Russia is still unknown. An employee of one of the major record companies says that Spotify planned to start the service in April 2014, and if it does not have time, then the launch will be postponed to the third quarter of 2014. Another source in one of the content aggregators claims that there is no talk of launching in the spring, this will most likely happen closer to autumn.

Spotify could not find the head of the Russian office for a long time and this was one of the reasons for the delay in the launch, says one of Vedomosti's interlocutors. As for catalogs, the company has no problems with this: it has long signed global contracts with the three largest majors - Universal Music, Sony Music and Warner Music. And Spotify takes the catalog of Russian music from aggregators - Orchard, Beleev and Rights Comunications, says a source in one of these companies. This catalog contains more than 90% of all Russian music, which is, for example, in Russian iTunes.

Russia has a high level of piracy, and Spotify usually prefers to enter such heavy markets with a local partner, a telecom operator, says an employee of a Western major. If Spotify acts independently and its service is not included in the operator's tariff, it is not clear what its advantages will be compared to other services, of which there are already many in this market, adds Strema CEO (like MTS, owned by AFK Sistema) Artem Zasursky. Spotify is negotiating with MTS, says MTS spokesman Dmitry Solodovnikov, but he does not disclose their details.

Spotify has good chances in Russia: it offers a model acceptable to our country - part of the music is free, part of the subscription on mobile devices, says Leonid Agronov, general director of the National Federation of the Music Industry^[7] the^[7].

Opening of a representative office in Moscow

A popular Internet music service in many countries Spotify opened in February 2014 a representative office in. Russia Now Moscow LLC "Spotifay" is actively recruiting staff^[8]

At the end of January, Spotyphai LLC was registered in Russia, the general director of which was Igor Sorokin. The owners of the company, according to the Unified State Register of Legal Entities, are Swedish Spotify Service AB (99%) and Spotify AB (1%). The Moscow representative office is located in the business center at 4th Lesnoy Lane, 4 - near the Belorusskaya metro station. The same building houses the offices of eBay and PayPal.

2013: Rumors about the launch of the service in Russia

In September 2013, it became known that Spotify could launch a music service in Russia in the first quarter of 2014, employees of several companies from the music industry told Vedomosti. The launch is planned no later than the beginning of the second quarter of 2014, says one of them. Spotify already has global contracts with the three largest majors - Universal Music, Sony Music and Warner Music, so there is no need to sign separate agreements with them to work on the Russian market, says an employee of a large record company. And Spotify will collect the catalog of Russian music through aggregators - Orchard, Beleev and Rights Comunications, adds a source in one of these companies. According to him, in this catalog - more than 90% of all Russian music, which is, for example, in Russian iTunes (works through the same aggregators). Negotiations are underway, but the exact timing of Spotify's launch has not been determined, a source at another major record company emphasizes.

The most successful Spotify launches happened when the company entered the country with a mobile operator, says an employee of a Western major. The service gained access to the operator's subscriber base and, most importantly, to its billing, through which you can collect payments for content. In Sweden, Spotify partners with TeliaSonera, in the UK - with operator 3 and Virgin Media. In Russia, Spotify is likely to work with MTS, since VimpelCom and Megafon already have their own music services, the Vedomosti interlocutor continues. MTS spokesman Dmitry Solodovnikov confirmed that the operator is "considering Spotify's offer," but declined to comment on the details. VimpelCom is also ready to discuss cooperation with Spotify, says its press secretary Anna Aibasheva. But she draws attention to the fact that VimpelCom is already providing subscribers with similar services Yandex.Music and Bilain.Music.

The cost of this service in Russia has not yet been determined, says a source in the music industry. But most likely the price will be lower than in the USA and Europe - this is what Apple did when it launched Russian iTunes at the end of 2012.

Spotify will be able to successfully launch in Russia if it has a full catalog of Russian music and the right marketing strategy that can bring the main target audience of such services - young people under 25, says Universal Music Russia CEO Dmitry Konnov.

The launch of Spotify in Russia could be much more important than the projects of Apple and Yandex, said Zvuki.ru founder Sonya Sokolova. iTunes is still designed mainly for the audience of Apple devices, and Yandex.Music is a project subsidized by Yandex, the company does not earn or develop this market on it. In addition, the Spotify model, which allows you to listen to music for free at the expense of sponsors, is very organic for Russia, Sokolova concludes.

An employee of the record company says that Spotify will become the main competitor to Yandex and Vkontakte.

"New players can come to the Russian market, but you need to understand that now the level of piracy is still so great that there is no need to talk about normal competition between legal services, says Konstantin Vorontsov, head of the Yandex.Music service. Any new player in the short term does not change anything, but we all work for the future and gradually accustom users to legal content^[9]

Notes