However incongruous music and news may be together, the two industries do presently face something in common: an ongoing struggle to get people to pay for their products.
Proliferation of free content on the internet has made people unwilling to pay for songs and news stories alike. So it may be a smart business decision for the 165-year-old New York Times to partner with burgeoning digital music streaming service Spotify. The two companies announced an offer today (Feb. 8) giving a free year of Spotify Premium to anyone in the US who signs up for an all-access subscription to the news publication.
Premium normally costs $120 a year, and the offer slashes the price of an all-access Times subscription too—from $6.25 a week to $5 a week for the music-and-news bundle. While it may seem like both companies will take a hit from these discounts, the boost in new subscribers/readers will likely more than make up for it. The Times, despite recently signing up a record number of new subscribers thanks to US president Donald Trump’s directed attacks, has been facing heightened pressure to lure more digital subscribers as print advertising revenue plummets.
With 40 million paying subscribers, Spotify is also sizable and growing—but it’s under constant threat of being overtaken by other players like Apple Music in the neck-and-neck music streaming field. Spotify is said to be delaying its highly anticipated IPO until 2018 thanks to snags within licensing deals and its still-fluctuating business model.
“If you think about the places where people spend their time in media, they spend a lot on music and a lot on news,” the Times’ chief revenue officer Meredith Kopit Levien told Bloomberg. The Times declined to comment on how the two companies will share revenue.
Music and news companies have teamed up previously. In the 2000s, some news publishers tucked free CDs and DVDs into their pages to attract new readers. It worked initially—but keeping those readers proved difficult. Spotify and the New York Times could encounter the same issue, as the special $5-a-week pricing only applies to new subscribers for the duration of one year.