Will Sweden-based Spotify be iTunes’ Waterloo?

Lost in all the hype this week about Google Plus was perhaps the biggest news in the music industry since Dylan went electric — the Swedish are coming, the Swedish are coming! Online music service Spotify announced it is coming to the U.S. after several years of false alarms and rumors.

So what? Why all the hype? Well, several music services (Rhapsody, MOG, Pandora,  iTunes Cloud) have threatened to change the way we buy and listen to music, but none have the success rate of Spotify. In Europe, Spofity has more than 10 million users and a million paying subscribers. That’s a huge user base and from what I’ve read its both comprehensive and easy to use. If the pricing structure rumors are true…and they probably are…for $10 per month American users will be able to listen to  “any track, any time, anywhere.” As my 13-year-old son says: “nobody buys music anymore dad!” If he’s right…and I believe he is…I won’t be buying music anymore, but rather I’ll be buying the right to listen to whatever I want wherever I want and at only $10 per month that’s a hell of a deal.

The news media has been all over this story this week, and many of them are warning us not to assume Spotify will change everything. But it already has. Plenty of my friends have jumped into Rhapsody and I’ve stayed on the sidelines. Spotify comes with something Rhapsody doesn’t have — customer loyalty and brand appeal. Spotify is cool. Wired compares the service to “a magical version of iTunes in which you’ve already bought every song in the world.

If you’re like me you’ve always bought the music you want. I have hundreds of CDs gathering dust, and even some casette tapes in neat carrying cases tucked away in my closet. And with the switch to digital music I still buy music when I find something I like. It’s natural for my generation to want to own the music. But with Spotify comes the tipping point for the subscription model. Why store CDs or even gigs of digital music on an external hard drive anymore? What’s the point? The music is in the cloud and it will always be in the cloud…the question becomes not whether to buy the new Eddie Vedder album, but rather which service to listen to it on. With Spotify you can stream the album on your computer, on your iPhone, on your iPad…in your car, at the gym, at work. It’s always there and you can listen on any platform. It is truly like having a Tower Records in your pocket.

Owning music is so last century.

2 thoughts on “Will Sweden-based Spotify be iTunes’ Waterloo?

  1. Rhapsody may not be “cool” (where I think you meant it as “trendy” and “hip” rather than “interesting” and “unique”), but it pays roughly 50 times what Spotify does to an artist per stream. Perhaps this is why many artist advocates in the music business consider Spotify the barest step above piracy.

    So, what was the “tipping point” that Spotify brings to the subscription model? Napster and Rhapsody do everything Spotify does. Spotify has a million paying subscribers, Rhapsody has 750,000. Spotify has 13 million songs, Rhapsody has 11.5 million. Rhapsody has been available on players for years, and I’ve been listening offline to my Rhapsody iPhone app for almost a year. Not that I’m particularly enamored of Rhapsody, which has its own problems, but I just don’t get the sudden epiphany people are having.

    But then, you lost me when you started stumping, nay shouting, about the “cloud”, which must be the single most vacuous and banal tech cliché in use today. Ugh.

    • Rhapsody paying 50 times what Spotify pay per track played?! I think you relay need to check those figures, my sources say the opposite when it come to the majors. Not by much though but still absolutely not the figures you give in your post.

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