Spotify attacking Nokia with new 3 deal

Spotify Mobile - the Swedes' killer app
Spotify Mobile - the Swedes' killer app

Spotify's newly inked deal with 3 to distribute its service as part of a tariff is exactly what the company needed to become a force in the music industry.

The online streaming model might have been fun for users, but long term it was never going to be enough to sustain the brand.

But the new plan will essentially tie subscribers into the service for at least two years, which is guaranteed revenue for Spotify and will keep it from going the way of so many cool web start-ups.

Cashing in

Premium subscribers are the main way the company is going to keep investors happy through profits, and there has been some criticism of the sky high price and minimal benefits the £10 a month cost brings.

The 3 deal alone won't be enough to get anywhere near profitability, but by partnering with the most open-minded network in Britain, Spotify will be able to prove it's an attractive proposition to bundle into a new contract.

It's already told us that it plans to push the notion of Spotify Mobile out to as many platforms as possible, and it's feasible another big name will be announced before 2010.

All you can eat music is a service others have already began bundling, with the likes of Vodafone's Music Unlimited offering all the music you want on your handset for £5 per month, clearly proving that the bigger names have realised subscription-based services are the way forward.

But it's the brand consumers fall in love with and trust, and while they might be happy with Vodafone giving them calls and texts, would £5 a month less be enough to entice them away from the musical familiarity of Spotify?

Comes with Spotify

For that very reason Nokia might start having some sleepless nights soon, as the new 3 / Spotify deal brings it almost into direct competition with the Finns' Comes with Music service.

Sure, you can argue that CwM offers tracks to keep - but they're locked down to one handset forever. With Spotify, when the subscription runs out you might lose the music, but it's always there for you to restart subscriptions.

Spotify has seen a real opportunity to be the new face of mobile music - coming from a 'free' background has given consumers the chance to try and trust it, and now it's about converting that trust into cold hard cash.

If it's bundled in with a tariff, consumers will be less likely to take umbrage at paying a little more each month, as they're used to 'X' amount leaving their accounts every month.

And of course, it's also only a matter of time before we see the branded Spotify phone - and then the Swedish streamer can really stamp its authority on the mobile music market.

Gareth Beavis
Formerly Global Editor in Chief

Gareth has been part of the consumer technology world in a career spanning three decades. He started life as a staff writer on the fledgling TechRadar, and has grown with the site (primarily as phones, tablets and wearables editor) until becoming Global Editor in Chief in 2018. Gareth has written over 4,000 articles for TechRadar, has contributed expert insight to a number of other publications, chaired panels on zeitgeist technologies, presented at the Gadget Show Live as well as representing the brand on TV and radio for multiple channels including Sky, BBC, ITV and Al-Jazeera. Passionate about fitness, he can bore anyone rigid about stress management, sleep tracking, heart rate variance as well as bemoaning something about the latest iPhone, Galaxy or OLED TV.