Spotify Launches In The U.S. – Will It Help Or Hurt The Music Biz?

Music streaming service Spotify finally launches in the U.S. today after it’s introduction in Europe in 2008 and having 3 years of popularity in Europe.

There are three sign up options; a free ad supported one that lets you stream music, but is limited to 10 hours per month and is supported by ads, a $5 per month version that lets you stream unlimited and is ad-free and a $10 per month option that let’s you stream both online and offline and allows you to stream across your mobile devices. The service has a social element to it that allows users to create and share their playlists across social networks.

After several years of negotiation with the major record companies and much speculation whether it would ever launch in the U.S., Spotify is now officially open for business with a catalog of 15 million songs available to its subscribers. With these subscription services gaining popularity; MOG, Rhapsody and Rdio plus the new cloud services that have been recently announced by Amazon, Google and the soon to launch Apple cloud, there is a lot of debate about whether having access to music in the cloud, where you never own a digital audio file but instead pay for streaming access will be devastating to actual digital/physical sales where an actual audio file is locally stored on your computer or device.

There is also some concern among the music community that the royalty payments earned via Spotify [in part because of the deals with the record companies] might be too small to make up for the other digital and physical sales that they and other cloud services may be cutting into. With a reported 1.6 million paid subscribers and more than 10 million registered users in total in Europe and even bigger subscription numbers expected for the U.S., the millions of plays will hopefully equal some decent royalty payments for artists.

Either way, it looks like the days of actual physical ownership of music files might soon be over. Is having access just as good as actually physically owning your music? Are these new services going to help improve the music business market? Will these cloud services allow artists to continue to innovate and sustain themselves independently?

This is yet to be seen.

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