Spotify vs iTunes: the coming war

Spotify looks to woo music labels with the idea that the album is not dead, as iTunes would have us believe. In fact, Spotify says 30% of music download on their site is albums. Spotify uses a subscription method that looks to transform users buying habits and it is using this concept to muscle into the US market.

According to Spotify CEO Daniel Ek, Spotify launch is looking “pretty good” and he expects to launch inside of 2 months time. The CEO stressed that Spotify is more than just a medium to sell music, it will be a way for artists (and labels) to touch their customers, to learn more about their demographics and open a direct line of communication to them. So much more than that other sales tool, iTunes.

Says Ek, “we’re not only an ad-supported music company. We’re a subscription music company. And we’re a download music company, too. In certain territories, in downloads we’re number two or three after iTunes. So, through our platform there are different monetizations that are happening.”

When asked how the company will set itself apart, Ek replied, “I think if we start getting the entire music industry with us on this, we can see them experimenting on things like putting lyrics next to every track, or videos, or behind-the-scenes videos if you actually buy the album. Or you might be getting a playlist with the live set list of the show you saw.”

Spotify inked a deal with Telia in Sweden that preloaded Spotify on devices and even 3G data cards. Not only did this grow Spotify, but according to the company, reduced churn for the teleco. That is something Spotify will use to get it’s hook into the US market. Reports have suggested even Google is on board.

Clearly, Spotify is looking to gain support from music labels and mobile carriers as they know consumers will follow. With iTunes seen as the backbone of the iPhone, Spotify could be a welcome competitor.

Read [Billboard]

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