- Digital Press Explodes With Joy
It seemed like nothing could push the Google+ exclusive club out of the press’ inner circles on news Web sites, LinkedIn and Twitter, but as soon as Spotify confirmed it would launch this Thursday morning in the US, there was a massive explosion of thoughts, opinions, reviews and anticipation.
Spotify launched in the US with a fervor they couldn’t have paid for if they tried, so perhaps the endless months of rumored launches paid off in the end.
Spotify has hit the US after working its way through Europe and becoming the second largest source of digital music revenues for labels in Europe, according to the company. Spotify has more than 10 million registered users in Europe and around 1.6 million of them pay for the service. During 2010 Spotify paid more than €45 million ($63.9 million) to their licensors.
Spotify has allegedly said it believes it can bring in 50 million US customers during its first year of operations.
Spotify’s big features breakdown like this:
- The Tunes. Users get on-demand access to songs and can create playlists from a library of 15 million tracks. Tracks can also be uploaded from a PC, which Spotify does automatically when it’s opened, and makes the experience like a one-stop music player.
- Sharing Everything. Users have created and shared more than 250 million playlists from the service across social sites and a wide variety of third-party sites that aggregate the most popular playlists. The biggies are http://www.sharemyplaylists.com, http://www.bbcify.com and playlist creators like http://www.spotiseek.com. It also has built in sharing with Facebook, Twitter, email and SMS.
- On the Go. Paying users can install Spotify on iOS, Android and other mobile devices. Mobile apps allow users to sync their playlists and songs from the desktop app and can use an offline mode that gives them access to certain playlists even when 3G and Wi-Fi networks aren’t available.
For its US launch, Spotify is requiring users to either wait for an invite or pay for one of the subscription services, despite all of its US social sharing options which say "no invitation is needed!"
The three tiers of the service offered in the US break down like this:
| Spotify Tiers in the US | |||
| Premium | Unlimited | Open | |
| Price (per month) | $9.99 | $4.99 | Free |
| 15 million tracks | Yes | Yes | Yes |
| Play and organise your own MP3s | Yes | Yes | Yes |
| Spotify social | Yes | Yes | Yes |
| Take your music abroad | Yes | Yes | 14 days |
| Spotify radio mode | Yes | Yes | No |
| No advertising | Yes | Yes | No |
| Play local files on your mobile | Yes | No | No |
| Play music from Spotify on your mobile | Yes | No | No |
| Offline mode on your desktop | Yes | No | No |
| Offline mode on your mobile | Yes | No | No |
| Enhanced sound quality | Yes | No | No |
| Exclusive content | Yes | No | No |
| Play Spotify through music systems | Yes | No | No |
One quick note about the service is that the radio modes don’t seem to have appeared on the US services yet, even for premium users.
Spotify’s US launch was ripe with partners, including Coca-Cola, Sprite, Chevrolet, Motorola, Reebok, Sonos and The Daily. The companies all launched campaigns to promote their brands and the new service, mostly by giving out codes and invites for the launch.
Ken Parks, chief content officer and managing director of Spotify North America, said: "Spotify was founded as a better, simpler alternative to piracy. So making sure that the people who create the music prosper is hugely important to us. We have full catalogues from all the major labels and a raft of independent labels including those represented by Merlin, which means all of their artists are being fairly compensated for their creativity every time people enjoy music through Spotify."
US Competition
In the US, Spotify will face some stiff competition, largely from Pandora which just completed an IPO, hit 100 million users, redesigned its site and announced that it reaches 35% of all smartphone users in the US.
As of April, Pandora controlled more than 50% of the market for Internet radio listening. Other big players in the market include Rhapsody, Grooveshark and Last.fm.
Spotify’s big chance in the market may come from its plans to integrate into Facebook and gain a solid userbase within its initial week.
One area Spotify will have to make inroads on is the smart devices. Pandora has become a default in the smart TV, STB and Blu-ray platforms. Spotify will need to find a way to link its service to these devices as they become more and more popular, though it may take the approach it did for these in Europe and get involved with pay-TV companies to land on their STBs.
For now, Spotify has launched and is slowly rolling out to new users as invitations make the rounds. There is a lot of buzz but since invitations appear to be very limited right now, it could face a hurdle of getting and keeping new users simply because of a wait time.
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