Deezer is a French company founded in 2007 by Daniel Marhely and Jonathan Benassaya. A web star renowned for its audio quality, innovative features and services, Deezer has established itself as an innovative music streaming platform for businesses and users alike. With a catalog of over 120 million tracks, the young French startup continues to roll out its strategy around the world in the face of formidable competitors such as Spotify, Amazon Music and Apple Music. Let’s take a look at the history of this “Made in France” audio streaming service, as well as its roll-out strategy, which focuses primarily on corporate partnerships and user experience.
The beginnings of Deezer
The Deezer adventure began on rue Emile Menier, in the 16th arrondissement of Paris. In 2006, Daniel Marhely, a young computer scientist, set up Blogmusik.net, a site that lists all the artists’ audio files available on the Internet and lets you listen to them, free of charge and without downloading. But for copyright infringement reasons, the site closed in April 2007, under pressure from SACEM (Société des Auteurs Compositeurs et Editeurs de Musique) and SDRM (Société pour l’administration du Droit de Reproduction Mécanique). The following year, Jonathan Benassaya, then a student at ESSEC business school in Paris, met Daniel Marhely at a startup incubator. Together, they founded Deezer, the first free music listening site, this time in agreement with SACEM. This new “Made in France” streaming service remunerates artists and copyright holders via advertising revenues. Xavier Niel, Chairman of Free, has chosen Deezer as the digital platform for his telephony offering. He invested €250,000 in exchange for a 20% stake in the young Parisian start-up. Xavier Niel also wants to take the wind out of Universal Music’s sails, as it prepares to activate a partnership with rival Neuf Télécom. In 2007, Universal Music declared in a press release that no agreement had been signed with the streaming company, and that its repertoire on Deezer was being illegally exploited. It wasn’t until 2008 that Universal Music entrusted the platform with its catalog of artists.
At the time, Deezer’s business model was as follows: the site was entirely free. As of February 2009, listening is only possible after authentication on the platform. Advertising sequences scheduled every 15 minutes enable the young company to pay artists and copyright holders. In November 2009, Deezer launched two pay services, offering ad-free listening and better sound quality. In June 2011, free listening, by logging in to your account, becomes limited to 5 hours per month, and the artist catalog is restricted. A Premium offer is then available, allowing ad-free listening. In December 2011, the French streaming platform counted 20 million users, including 1.4 million subscribers to its Premium offer.
Partnerships with labels and record companies
The success of the start-up enabled it to quickly sign contracts with labels and record companies. Since its launch in 2007, Deezer has included 160,000 tracks from the Sony-BMG catalog. By 2008, the repertoire totaled 1.5 million audio titles. In May 2008, the integration of Universal Music’s impressive European catalog (covering 35 countries) added a further 1 million titles to the Streaming offering. That same year, the Google query “Deezer” was one of the top 10 most-searched words on the famous American search engine! The Warner Music Group catalog was integrated into Deezer in September 2008, making 4 million tracks available on the web.
Deezer for businesses
In December 2009, fast-food chain Mc Donald’s approached Deezer to replace its point-of-sale music system via a corporate partnership. This offer enables more than 600 restaurants in France to play music without advertising. In January 2010, Axel Dauchez, the new Managing Director of Deezer France, was tasked with monetizing the service. In March 2010, 3 advertising images appeared on the platform’s home, music and radio pages, and a partnership between Orange and Deezer was launched in the summer. Orange acquires an 11% stake in Deezer, enabling it to include Deezer Premium in its premium telephony offerings. In October 2014, the company acquired Stitcher, an American streaming platform specializing in podcasts and radio content. In early 2017, the Fnac-Darty group joined forces with Deezer for a 3-year period, taking a stake in the Paris-based startup. For every purchase of an audio product (headphones, amp, speakers, etc.), Fnac-Darty customers receive 3 months’ free subscription to Deezer Premium. In August 2018, the company valued at over a billion euros joined the prestigious club of “Unicorns” thanks to a fundraising round amounting to 160 million euros.
Deezer’s rival platforms
Over the past 15 years, streaming has become the new way to consume music. The range of products on offer continues to multiply, in an attempt to differentiate themselves from the competition. Deezer has been in business since 2007, and is now up against its historical rival Spotify. Other services have since emerged, such as Apple Music, YouTube Music and Amazon Music. Other audiophile-oriented streaming platforms such as Tidal and Qobuz have also appeared on the scene. A quick overview of the music streaming platforms competing with Deezer :
- Amazon Music: the American giant’s catalog boasts over 100 million titles. The service is integrated into Amazon Prime or available at €9.99/month (Amazon Music Unlimited). Audio files are of “SD” quality on the Prime version and “HD” and “Spatial” (encoded in Dolby Atmos) on the Unlimited version. Unlike Deezer, the Prime version does not offer Playlist creation.
- Apple Music: like Amazon Music, the American giant offers over 100 million tracks in streaming, and although only recently launched, this digital broadcasting service benefits from its iTunes Store experience. The offer is €10.99/month with lossless quality. The service also offers access to multiple radio stations, as well as video clips and a lyric integration service.
- YouTube Music: the successor to Google Play Music, which will be discontinued in 2020, YouTube Music offers the largest catalog, since it is open to all those who broadcast videos on the platform. However, audio quality is limited to 256 kbps, well below Deezer’s 320 kbps (MP3) and FLAC HD (CD quality). Its compatibility with iOS and Android operating systems has also been heavily criticized.
- Spotify: Deezer’s long-standing competitor, Spotify’s catalog offers 80 million tracks and its MP3 audio quality is limited to 320 kbps (equivalent to Deezer in its SD version). Its real strength, however, lies in its sheer number of users: the Swedish platform boasts almost 500 million worldwide! It is also compatible with a large number of applications such as Alexa, Siri and Google Home.
- Qobuz: France’s second-largest streaming platform clearly plays the audiophile card, offering 24-bit 192 kHz encoded studio quality (superior to CD quality). Nevertheless, the artist catalog is limited. However, the offer remains interesting for Hifi enthusiasts.
- Tidal: Sweden’s second-largest platform boasts a catalog of over 70 million tracks and 250,000 video clips. On the other hand, the Hifi-Plus 24 Bits version is more expensive than its competitors.
- Soundcloud: this platform with 20 million users enables artists and musicians to collaborate by broadcasting their musical projects.
Sound quality and technological development
At launch, Deezer’s audio files were encoded at 128 kbits, whereas other competing platforms were already offering 320 kbits encoding (better quality for MP3), which the company will soon correct. In 2015, Deezer launched its Deezer Elite offering (now renamed Deezer Hifi), offering the streaming of content in FLAC quality (CD quality). It should be noted that Deezer does not allow audio files to be recorded, and that the French company has been fighting against streaming recording software from the outset, notably by integrating countermeasures in its files. At the same time, Deezer has always invested in Research and Development to offer its users the best possible experience. This is particularly true of our Flow system, which enables us to understand listeners’ needs and provide them with the appropriate content. Deezer has even developed an application for companies and brands to synchronize their customers’ musical tastes with their Deezer Premium profiles! Last but not least, Flow Moods, an Artificial Intelligence (AI)-based feature that offers 6 infinite playlists based on user preferences.
Deploying Deezer’s international strategy
In April 2022, Deezer merged with SPAC I2PO, created by the Pinault family, Matthieu Pigasse and Iris Knobloch, the new president of the Cannes Film Festival, to prepare for its IPO. His goal is to achieve profitability by 2025. The “Made in France” music streaming platform continues to roll out its international strategy, setting up operations in a number of countries to forge partnerships with major companies, such as Tim Celular in Brazil and RTL in Germany. It’s only once established that Deezer offers subscriptions to music lovers. Today, the French startup is available in 185 countries, and Jeronimo Folgueira, new CEO since 2021, can count on the platform’s own innovations, such as excellent sound quality, personalized playlists and the ability to translate song lyrics into the desired language, to accelerate its development.
Deezer in figures :
- The company was founded in 2007.
- In 2022, Deezer generated sales of over €450 million.
- Today, Deezer is a French unicorn.
- The company has 9.4 million subscribers worldwide, including 3.3 in France (2022).
- The artist catalog boasts over 120 million titles.
- Deezer employs over 600 people worldwide (2020).
- The music streaming platform is available in 185 countries.
Prices, formula, podcasts, available artists… go to www.deezer.com/fr
