Spotify losses, will they sink the streaming dream

Spotify losses are a little bit of the heavy side. The too-many-pies side of £16m in fact. The Swedish streaming advocate has just published its 2009 accounts and they should now be playing The Rolling Stones’ Paint It Black. How long can Spotify keep haemorrhaging money? And will the planned US launch fix the issues or just add to the woes?

Music Ally, the music industry expert blog, dived deep into the figures. It notes that Spotify has 7m subscribers with only around 250,000 of those stumping up some cash for a Spotify Premium account. Subscribers jumped sevenfold in 2009 but the majority of those new folk aren’t paying even with the lure of the Spotify iPhone app.


Check Out Our Most Recommended


Currently Spotify makes around 40% of its revenue from advertising (£4.51m) versus £6.81m in subscriptions. Unless those advertising figures get a lot better, Spotify needs to up its conversion rate and start netting subscribers. Don’t be surprised if ad-supported accounts start getting very restricted.

Spotify US was due to open its virtual doors in January but its repeatedly kicked the launch back as the US record labels dig in their heels over contracts. Spotify’s spokesperson says it still intends to launch in the US before the end of this year – that’s five weeks to get it sorted.

Let us know: do you think Spotify can survive? Or are those losses just too big to sustain?

Out now | from £free | Spotify (via Music Ally)

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *