Spotify is the world’s largest streaming music service with more than 40 million paid subscribers. They’ve done well, yes, but they’ve yet to crack the world’s second-largest music market: Japan. Now, though, they’re taking a run at the country, having just launched.
But people familiar with Japan and the habits of its music consumers say that Spotify is doomed to fail. Why? The Japanese love their CDs too damn much.
What? Say again? That’s right: Japan is still crazy for the compact disc. From Bloomberg:
On a recent muggy afternoon in Tokyo, 21-year old Shintaro Naganuma joined several hundred customers browsing CDs at the eight-story downtown outpost of music retail chain Tsutaya.
Having discovered a couple of new rock artists on YouTube, the third-year university student hit Tsutaya Co.’s flagship store in trendy Shibuya to look up their albums. That process encapsulates the dilemma now facing Spotify Ltd.’s head Daniel Ek, who on Thursday presided over the music streaming service’s long-awaited entry into the world’s second-largest music market.
On the one hand, the nation’s consumers have grown accustomed to finding music or listening casually through smartphones, which should help the Swedish company attract users for its free ad-supported version. But when it comes time to hand over the cash, most people in Japan continue to buy CDs and even vinyl. That’s largely because record labels remain wary of signing away their music to streaming services.