Spotify is preparing to be acquired at a price tag ‘north of $14 billion,’ according to multiple sources now speaking with Digital Music News. Signatures and final approvals are ‘exceptionally close,’ with an announcement carefully planned for exactly one week from now, according to one dealmaker.
The buyer is not being disclosed, though the Wall Street Journal is already preparing a front page story for next Wednesday morning. The article will symbolically only be available to paying subscribers.
The paid-only symbolism is part of a massive shift in philosophy by both Spotify, the major labels, and its soon-to-be-named mega-buyer. The deal comes amidst cantankerous negotiations between Spotify and the major recording labels, with the CEOs of both Universal Music Group and Sony Music Entertainment applying heavy pressure on Spotify to eliminate their free access tier. Spotify initially resisted those moves, but is now softening its stance as part of an artist-friendly, three-way deal involving YouTube and its various music properties.
According to the details of this momentous plan, shared under strict confidence with Digital Music News, YouTube has agreed to stop showing free music videos entirely if Spotify agrees to close its free access tier at the same time. The unilateral move will make listening to free music far more difficult for casual music fans, and millions of Spotify and YouTube listeners will be shocked to find free streaming music completely shut off, effective next Wednesday.
The plan is expected to mint several million paying subscribers overnight, and substantially change the music industry balance sheet in the process.
“We’re finally making streaming fair for every musician and rights owner, and I’m happy that everyone can equally enjoy the spoils of our years of hard work,” Ek stated, in a quote approved for the Wall Street Journal. “I hope our friends over at Pandora will follow our example.”