America: Meet Spotify, Europe's Successful Foray Into The Future of Free(ish) Music...
For the past decade, we've seen site after site go in and out of favor, sometimes quickly. We got excited about Napster back in 2001, but after all the foolishness that ensued in the wake of its demise, we're quick to give the side-eye to anything new coming around.
Conversely, iTunes has shown that we're more than willing to pay for music, so long as we get it headache-free.
Enter Spotify. The Swedish site is already a mainstay among European listeners, and it made its debut yesterday on this side of the Atlantic.
In the simplest terms, Spotify is a streaming site where listeners can stream a limited number of tracks free of charge. The limits are as follows: For the first six months after a user signs up, they may listen to up to 20 hours of free music per month, with a maximum of five plays per track, per month; 15-second ads are mandatory before listening to the free songs. After the first six months, free users can listen to 10 hours of free music per month. Free users can make and share playlists, but in order to gain unlimited access to the over 15 million songs on Spotify, they must pay a monthly fee of $4.99 (or $9.99 for a premium membership, which includes offline mode, mobile support, better sound quality, and access to "exclusive content," whatever that means.)
Through combining free and paid services, Spotify seeks to answer several questions that have plagued internet entrepreneurs for over a decade.
Firstly, how much are people willing to pay for entertainment? If they're not willing to pay, how much advertising can they tolerate in order to get the content for free, without turning off the player in frustration at the excessive ads?
Secondly, how cheaply will the companies that actually own the copyrights to the content allow said content to be sold for?
Spotify's answers to these questions are as follows. The service has 10 million users throughout Europe, one million of whom have paid subscriptions. The company believes that users will start with the free service, then become reliant on Spotify for their music -- so much so that they are willing to fork over a nominal amount rather than having their service reduced. Reduction in free service is like a gentle nudge toward paid subscriptions. For users who stick to the free service, Spotify believes the 15-second ad isn't excessive enough to make users stop listening and go elsewhere for content. In answer to the second issue -- that of record company copyrights -- Spotify has finally gotten the four major record companies, Universal, Sony Music, EMI, and Warner, to allow them to operate in the States.
Due to Spotify's runaway success in Europe, this probably would've happened sooner had these companies not spent several years mulling over and negotiating the deal. What this means for the record companies is yet to be seen, but the Big Four seem to believe that this risk will be worth it; representatives for Universal in the U.K. have said that Spotify seems to have a sustainable business model on their hands.
What does this mean for you, the user? Free music, of course. Unfortunately, Spotify is currently pulling a Google+ and is an invitation-only deal at this time.
So, if you've used it, comment away with your opinions. We want to know: Would you be willing to pay for the service? Are the ads too much for you?
Ultimately, the listeners' tolerance to these practices will determine Spotify's longevity on the rocky road of free music.