MC Explains | Will breakup with Zee Music hit Spotify’s big India plans?

With a significant chunk of hit Indian songs missing from its playlists, Spotify's ambitious plans for India may be put on hold.

A whole bunch of much-loved Bollywood songs disappeared from the music streaming service, Spotify, in March. On keen observation, it's evident that all the missing songs were from the Zee Music banner. Moneycontrol delves into the tiff that’s hurting music buffs.

Spotify and Zee Music failed to reach a mutual licensing agreement upon the expiry of the old songs. The licensing deal fell through because both enterprises couldn't agree on the monetary value of the popular songs. As a result, Spotify was forced to remove these songs as it was unable to secure audio streaming rights for them.

The No.1 track on Spotify in India over two weeks in March, "Apna Bana Le", from the soundtrack to the 2022 Hindi film Bhediya, became unplayable on the platform. Other songs included long-running Bollywood hits such as "Maiyya Mainu" from Jersey (2022), the title tracks from Kalank (2019) and Pal Pal Dil Ke Paas (2019), "Makhna" from Drive (2019), "Namo Namo" from Kedarnath (2018) and "Zaalima" from Raees (2017).

Zee Music had over twenty songs on Spotify's Daily Top 200 Tracks for India till March 14 - the final day its catalogue could be streamed on the service.

Music labels and streaming services like Spotify are mutually dependent on each other. Unlike Netflix, which relies majorly on original content and little licensing, Spotify has to get the licence of the catalogue of music owned by the labels. They run ads or charge subscription fees to make money. In turn, a cut of it is shared with music labels or individual artists.

Spotify vs Zee

"When a song gets played on Spotify, the rightsholders receive royalties for it, whether it's played by a Premium or ad-supported customer," says the Spotify website. Evidently, Zee Music stands to make a lot of money from Spotify.

Zee Music Company is the tenth most-subscribed YouTube channel with over 94 million subscribers. The company also shares a licensing agreement with JioSaavn, Apple Music and Amazon Prime Music. The music label has streaming revenues coming from diversified sources and it does not need Spotify as much as Spotify needs Zee Music.

With its revenue secured, Zee Music can browbeat Spotify into leveraging the deal in its favour easily.

Last year, the music company cut its ties with Gaana as well, a few months before the audio-streaming platform became a subscription-only service, showing its stronghold in the music industry.

Unlike the Western world, Spotify does not hold the supreme position in India. With India-specific offers as mini-subscription plans, Spotify India has been attempting to break away from its nearly 50:50 revenue mix for subscriptions and advertising and lean more towards the former.

Spotify told Billboard in a statement that Spotify and Zee Music have been unable to reach a licensing agreement. "Throughout these negotiations, Spotify has tried to find creative ways to strike a deal with Zee Music and will continue our good faith negotiations in hopes of finding a mutually agreeable solution," the streaming platform stated.

With a significant chunk of hit Indian songs missing from its playlists, Spotify's ambitious plans for India may be put on hold.