Thursday, February 12, 2009
Spotify - A Future Digital Delivery Model?
Spotify is a new online music service offers free online music sponsored by paid adverts and downloads. Created by two Swedish entrepreneurs, Daniel Ek and Martin Lorentzon and based in London and Stockholm, it has already attracted tens of thousands of users who in turn invited their friends to join. This week the company opened the ‘by invite only’ restriction to allow anyone in the UK to sign up. The company founders are reported to have invested more than €8m themselves and have received a €15m injection from two Scandinavian investment companies.
Spotify’s streaming service enables users to pick from a huge catalogue of songs, listen to them for free over the internet and, hear or see a few adverts along the way. Users can also choose to buy a day's worth of ad-free access for 99p, or become a premium subscriber – where there are no adverts at all – for £10 a month.
Spotify does not yet offer links to let people buy tracks today. Although users cannot keep the tracks they hear, there are no restrictions on how many times they can listen to a track. This results in reducing the incentive to download illegally. In the future, the company hopes to provide a service that works on mobile phones, car stereos and even iPods.
We signed up and were duly impressed. Every search brought new options to listen to a wealth of tracks but it was soon obvious that the range could have been deeper. Then we read that the music industry had the removal thousands of tracks in a row over licensing last month.
Other streaming services, such as Last.fm in London, bought by the American media conglomerate CBS in 2007, are growing in popularity as music on demand expands. We believe that the Spotify model could be something that works for movies, games and across all digital content, including books.