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It only just expanded from France to the UK a month ago, but now unlimited-music service Deezer plans to go massively global.
The company is right now brokering label deals for new territories, some of which it has in the pocket, new UK managing director Mark Foster tells paidContent.
“We had both a local and a global objective in launching here first,” Foster says.
“We already had licenses in place in France. The next stage for the UK was to negotiate similar contracts for the UK market. The third phase, which we’re in the process of competing now, was to negotiate with almost all the same labels globally.
“With the global record companies, you can do that pretty much from London. So it was important that the UK be our first springboard out of France.”
Deezer has 1.4 million paying subscribers out of 20 million users – a surprisingly high rate of success for observers who consider only Spotify and Rhapsody in the unlimited-music stakes. “Spotify has two million subscribers from six or seven countries,” Deezer’s Foster says. “While that’s a good number, Deezer in France alone has 1.4 million paying subscribers.”
But, in going global, Deezer will tip-toe around the U.S. market, where Spotify has found it is harder to win licenses and where Spotify now is getting its feet under the table. Instead, it will consider countries like Germany, Italy, Spain, Turkey, Indonesia, Korea, Mexico and Brazil, Deezer’s CEO told Reuters.
In France, Deezer has gained much from a relationship with France Telecom (NYSE: FTE) which makes its service available to Orange subscribers. It has brought a similar relationship to Orange in the UK.
And Foster says: “Orange has given Deezer in France huge reach very fast. There are up to a dozen territories where there will be strategic partnership with the key telco operators. Deezer is a very sticky product – once people use it as part of a trial, people tend to stay – we have a very high retention rate of about 75 percent in France.”