Record Labels Pressure Spotify Into Being Worse; Driving Users Back To Piracy

from the golden-geese... dept

I've spent a lot of time in Europe, over the past few years, at various music industry events, and one thing has become clear: all sorts of folks tell me that they stopped file sharing once they started using Spotify. It's uncanny. It shows, once again, that if you actually offer a good service, you absolutely can compete with file sharing. But there's no golden goose that the record labels can't kill, and they've been grumbling about Spotify for a while now... despite the fact that Spotify is making them more money than iTunes, in countries where it's available.

However, as we've seen, the entertainment industry has a special talent for screwing up a good thing, and their latest target is Spotify. Spotify still hasn't been released in the US, in part because some of the record labels (*cough* Warner Music *cough*) are demanding ridiculous restrictions on users, limiting any "free" parts to make the service a lot less appealing. Now it appears that the labels have also pressured Spotify into seriously cutting back on their free offer in Europe.

This will, undoubtedly, drive many of the users, who were making the industry money, back to unauthorized file sharing. In fact, many of the comments on Spotify's blog post about this say exactly that. For an industry that keeps claiming stamping out piracy is the number one goal, you would think it would know better than to take away the best tool they've had to compete with file sharing in a while. Spotify certainly isn't perfect, but it's amazing how quickly the recording industry seeks to destroy anything that starts making them money. They tried to do it with iTunes as well, but Steve Jobs fought back. Spotify apparently doesn't have the same clout just yet.

Really, this is symptomatic of the mentality of many of the bosses in the recording industry. They do absolutely nothing themselves to innovate. Instead, they resist and/or sue any innovation that comes along. Then, when an innovation finally breaks through and works, just as it's starting to really take off, the record label bosses get jealous and start complaining that these innovative services that are making them money are getting too much of the credit (and money) and demand a larger cut, making claims about how the service isn't the thing that's important, it's the music. Of course, if it were just the music that was important, these innovative services wouldn't be catching on. The service is important too, and each time the record label bosses overvalue their own music and undervalue the service, they end up killing off innovative offerings and driving users back to file sharing...

Filed Under: business models, free, record labels, spotify
Companies: spotify

Is Spotify Looking To Enable CwF+RtB For Musicians?

from the that-would-be-cool dept

There's been plenty of buzz around Spotify, the online music service that is available in Europe, but not in the US. Having played with the product, it's really nicely done, but there's always been a huge concern over whether or not there's a real business model there. The record labels have been notorious for burdening any useful startup with ridiculous licensing terms that make it close to impossible for any such business to survive (let alone profit). Spotify had said it was going to launch in the US, but hasn't been able to, and while the company keeps saying it's close, other reports suggest that the major labels still haven't reached agreements with the company.

However, what's much more interesting is this interview with Spotify CEO Daniel Ek, where he suggests the company wants to branch out well beyond the subscription/ad-based business models and start enabling musicians to offer other business models that sound an awful lot like the CwF+RtB business model we talk about here:

"We want a platform where we can [allow] lots and lots of experimentation. We don't know what will work for an individual artist. Some will benefit from scarcity. Some will benefit from it being widely available, even free. They might make their money by giving away all their music for free ... In the best of world, Spotify will become the platform where you manage your music and because you do that, we will figure out what kinds of offerings you're interested in. For certain types of artists, you might be interested in something unique. You might do a meet-and-greet. It might be that you want it on vinyl because it feels better. Or just go and see the show. Or have the merchandise."

Who knows if Spotify can pull it off (and if it will build this itself, or partner to do so), but this is a much more ambitious play than what's been talked about in the past, and while it's risky, seems like a much better long-term bet.

Filed Under: business models, cwf, music, rtb, spotify
Companies: spotify

Apple Approves Spotify App... Spotify Should Thank Google

from the good-timing dept

Just before the whole mess -- including an FCC inquiry -- of why Apple rejected Google voice on the iPhone, we were among those who wondered if Apple would approve Spotify, the well-hyped (perhaps over-hyped) music app that in many ways competes directly with iTunes. Well, it looks like Apple has approved the software, though Spotify is still only available in certain European countries (though there are promises of a North American launch later this year). You really have to wonder, though, how much of the approval was due to the mess and attention that Apple received following the rejection of Google Voice. It seems likely that the company is now (finally) a bit more sensitive to this issue, and may have decided that it didn't need another PR headache... or to give any more fodder to the FCC. Spotify probably owes Google a nice bouquet of flowers.

Filed Under: app store, arbitrary, iphone, itunes, music, spotify, streaming
Companies: apple, google, spotify

Will Apple Allow Spotify On The iPhone?

from the one-to-watch dept

Having used Spotify a bit, I can definitely see how some people think it could potentially replace iTunes completely. It basically acts like an iTunes that has access to millions of songs at no additional cost (and, yes, it's all licensed and legal). The songs are streamed, but you almost never notice it. It really does feel just like iTunes, while also having "Pandora-like" features for creating specialized stations or sharing others' playlists. Unfortunately, it's only available in the UK for now, though the rumor is it will be available in the US before the end of the year. However, where things could get really impressive is with Spotify's mobile app. For a few months, there's been a YouTube video of Spotify Mobile on Android: The demo highlights the fact that you can sync any playlist for "offline" play, solving the biggest question about weak mobile signals on the go, or how you use it on a plane or somewhere without wireless access. With offline syncing, it's basically everything that an iPod can do -- with access to 6 million songs without having to pay for each individual song. But, of course, Android is still a limited platform. The big fish these days is the iPhone App Store, and Spotify has now submitted an iPhone app for approval, which raises all sorts of questions. With Apple's history of rather arbitrary rejections -- including ones for things Apple has deemed "competitive" -- will it block Spotify as a rather direct competitor to iTunes? That would be very unfortunate, and again demonstrate the risk of a closed platform.

That said, the initial reviews of the iPhone app seem quite strong. Eliot Van Buskirk at Wired loves the syncing feature, and warns that "you'd have to pry it out of my cold, dead iPhone before I'll delete it from my phone." Meanwhile Music Ally points out that Spotify has uploaded a video of the iPhone app as well: It really does look pretty slick. So now the ball's in Apple's court. I have no idea if Spotify can survive as a business (and I suspect that the royalty rates the music industry wants will make that difficult), but it is great to see more innovation in the space. Now we get to see how Apple feels about that sort of innovation.

Filed Under: app store, arbitrary, iphone, itunes, music, spotify, streaming
Companies: apple, spotify