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Spotify partners Indosat with 'affordable' Indonesian service

Music streaming service Spotify has finally entered Indonesia in partnership with mobile operator Indosat Ooredoo.

JAKARTA - Spotify, the Swedish music streaming service, has teamed up with Indonesian mobile operator Indosat Ooredoo to test the possibilities of Indonesia's large Internet population.

     Spotify said it has taken three years since it entry into Asia to gather sufficient licensing from Indonesian music labels to support operations.

     "With every market, licensing is the number one priority," Sunita Kaur, Spotify's managing director in Asia, told reporters at the launch event in Jakarta on Wednesday.

     Spotify is available in 59 countries across the world with over 75 million active users and 30 million paying subscribers. Launched in 2008, the company is valued at over $8 billion, and has paid in excess of $3 billion for copyrights. It has licensed 30 million songs to date, and adds 20,000 every day.

     In Asia-Pacific, Spotify already operates in Hong Kong, Malaysia, the Philippines, Singapore, and Taiwan.

     Kaur said extensive research on suitable subscriptions in Indonesia came up with 49,990 rupiah (less than $4) per month -- less than half the international standard fee of $9.99 per month.

     Indosat's 69 million subscribers are being offered even more generous terrms. Premium subscribers get Spotify free, and regular customers can choose a credit package costing from 25,000 to 40,000 rupiahs.

     "We want to make sure it's affordable," said Kaur. She declined, however, to reveal Spotify target markets, saying the plan is to operate in the market and adjust plans accordingly.

     According to Kaur, existing Asian users spend 149 minutes on average every day on Spotify's web and/or mobile application. She said there is no reason why Indonesian users should spend any less. "It's such a big, vibrant market -- so much music here," she said.

     Alexander Rusli, president of Indosat Ooredoo, predicted "very fast" growth but also declined to go into numbers. "Music streaming is the new way of listening to music," he said.

     Indosat provides Spotify with Indonesia's second largest customer base after state-run Telekomunikasi Indonesia. It can also look forward to support on legal issues. The communications ministry recently said new regulations are in the pipeline that will require large Internet companies doing business in Indonesia to establish a permanent business entity or form a local partnership for tax purposes.

     Spotify is waiting for the new the government regulations before it announces its next move.

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