The music platform announced plans to expand into the country nearly a year ago, but it's still waiting in the wings as local rivals and global competitors like Apple (AAPL) and Amazon (AMZN) forge ahead.
The latest obstacle to Spotify's (SPOT) India launch came on Monday, when Warner Music Group (WMG) filed an injunction in a Mumbai court to prevent Spotify from offering Indian users music from artists like Beyoncé, Katy Perry and Kendrick Lamar.
WMG said Spotify "falsely asserted" it had the rights to songs from its music publishing division, Warner/Chappell Music. WMG claimed Spotify was citing a rule that applies to TV and radio broadcasters rather than online platforms.
"We had no choice but to ask an Indian court for an injunction to prevent this," a Warner Music spokesperson told CNN. "It's our goal to hammer out a deal that works for everyone. We hope this is just a speed bump in the expansion of our long and successful global partnership," the spokesperson added.
Spotify fired back late Monday, accusing WMG of using its Indian publishing rights to try to get global concessions from the streaming platform.
"WMG revoked a previously agreed upon publishing license for reasons wholly unrelated to Spotify's launch in India," a Spotify spokesperson said in a statement. "WMG's abusive behavior would harm many non-Warner artists, labels and publishers, and prevent Spotify from competing in the market," the spokesperson added.
A long wait
Spotify CEO Daniel Ek first announced plans to launch in India in March last year.
The company signed a licensing deal with Bollywood's biggest record label — T-Series — earlier this year, giving it access to more than 160,000 Indian songs. It was set to launch on January 31 but held off because it hadn't finalized deals with labels such as Sony Music, Universal and Warner, according to multiple reports.
The Spotify spokesperson said this week that most of those deals have now been signed — except for one.
"All other major labels and publishers have already agreed... to license their music," the spokesperson said, adding that Warner Music "remains the lone holdout."
Spotify declined to comment on when it expects to roll out its services in India. The company expanded into several new countries last year, including South Africa, Saudi Arabia and Egypt.
Light at the end of the tunnel
India's half a billion internet users are a tempting prospect for tech companies.
Google (GOOGL), Facebook (FB), Amazon and Netflix (NFLX) have invested billions to expand and enhance their Indian businesses in recent years. Affordable smartphones and increasingly cheap data prices have triggered a gold rush among the global technology industry.
Spotify posted its first-ever operating profit in the final quarter of 2018 and has nearly 100 million paying subscribers. But less than 10% of those are in Asia and the Swedish company is late to the party in India.
The market is dominated by local players such as Wynk, Gaana and JioSaavn, owned by India's richest man Mukesh Ambani, while Apple Music, Amazon Prime Music and Google Play Music have already established a presence.
"Data consumption is driving up overall content consumption," said Hanish Bhatia, an analyst at Counterpoint Research. "The market is now open and a company like Spotify will have access to 400 million smartphone users."
Unlike Spotify, the local platforms make their revenue primarily from advertising. But Netflix's success in India shows there could be room for a subscription-based service.
"The space for Spotify is very limited, but if we compare with the video streaming market, Netflix has created its own category, its own target market," he added. "And probably Spotify will create a similar target market, a premium target market for itself," said Bhatia.
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