Spotify (SPOT) - Get Report shares rose after the audio streaming titan announced a global licensing agreement with Universal Music Group, which is majority owned by Vivendi (VIVHY) and is one of the Big Three record labels.
Spotify shares rose 4.93% to $290.00 in pre-market trading on Wednesday. The stock has soared 84% year to date through Tuesday.
The agreement means that UMG will “deepen its leading role as an early adopter of future products and provide valuable feedback to Spotify’s development team,” the companies said in a statement. Terms of the deal were not disclosed.
The companies will cooperate on “new, state-of-the-art marketing campaigns across Spotify’s platform,” they said. “UMG will deepen its leading role as an early adopter of future products.”
Spotify CEO Daniel Ek expressed enthusiasm about the partnership. “From their early experimentation with Marquee, to testing new experiences like Canvas, Universal Music Group has been an important partner in helping to shape the development of our marketing tools,” he said.
“With today’s announcement, we will expand on this level of early stage innovation and further strengthen our partnership and shared vision for helping advance artists at all stages of their careers.”
As for Universal’s take, “with this agreement, UMG and Spotify are more aligned than ever in our commitment to ensuring the entire music ecosystem thrives and reaches new audiences around the globe,” said Universal CEO Lucian Grainge.
“Working together, our teams will expand and accelerate our collaborative efforts to deliver artist-focused initiatives, strategic marketing campaigns and new offerings.”
Spotify had 286 million users, with 130 million premium, paid subscribers, as of March 31.