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Spotify turns up the pressure

Later this week Spotify has announced changes in its subscription system that affect users of the Spotify Free and Open versions. If last year streaming was limited to a maximum of twenty hours per month, starting on 1 May this will be reduced to ten hours per month, and individual songs will be limited to a maximum of five plays per month. The changes do not as yet affect users of Free or Open accounts created after 2 November 2010, who will enjoy the standard service for six months. After this time they will also be subject to these restrictions. The blog entry written by the founder himself, Daniel Ek, says that by “making Spotify available to millions across Europe... people are listening to more music and from a wider range of artists than ever before, and are giving up on piracy.” Ek added: “This is exactly what we hoped would happen.... So it’s vital that we continue offering an on-demand free service... but to make that possible we have to put some limits in place going forward.”
Spotify has built a model that has managed to put order into the chaos and draw millions of users away from illegal downloading. For no other reason than this it deserves our praise.
Users’ reactions have been varied, although the first comment in the blog is categorical: “So long Spotify. It was nice knowing you. Guess I’ll go back to pirating music again then.” At the moment Spotify is present in seven countries and boasts six million users, of whom one million have a premium account. The current catalogue contains over ten million songs and is continuing to expand at a steady pace. Although it might not please those users who support the free-only format, the fact is that Spotify is up till now the best formula based on the model Freemium that finds a balance between advantages for all users and a fair system of financial returns for artists. Nevertheless, many music companies that agreed enthusiastically to the inclusion of their music in Spotify, because they expected huge profits, have now completely withdrawn their catalogues (this is the case of ECM and Naxos) on not seeing their expectations fulfilled (very inflated in some cases). But not everything is restrictions, because the pay offer has been broadened to adapt to another type of customer: Spotify Unlimited, which is similar to the Spotify Open service of a couple of years ago, offers unlimited music, without advertising and with the ability to connect from outside the country where the account was set up (useful for those who travel a lot). The main limitations are that it cannot be accessed on mobile devices and the audio quality is the same as in the Open version. It costs € 4.99/month. Spotify Premium has no restrictions of any kind: it offers unlimited listening, is free of ads and runs on mobile devices. It also permits local storage that makes it possible to listen to songs even if you have no Internet access, works with domestic wireless devices and the audio quality is 320Kbps. The price is € 9.99/month. In my opinion Spotify’s proposal is solid, consistent and honest. It is a model that has managed to put order into the chaos and draw millions of users away from illegal downloading and even persuade them to pay for the service. For no other reason than this it deserves our praise. PS: Before long we will have news of Spotify’s American venture, the Swedish company’s new plan to penetrate the U.S. market, currently dominated by Groove Shark. This is a similar service, the difference being that it requires no installation or registration (all via web), and it lays claim to a massive twenty-eight million users.