Spotify Lost Millions of Dollars in 2009, US Launch Might Help

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Spotify Lost Millions of Dollars in 2009, US Launch Might Help

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• Publié par: ijefyhaw
• Nombre de lectures: 97
• Langue: Français

Extrait

22 November 2010

Spotify UK recorded

loss of $26.7 million for

2009

Spotify

By: Giorgiana Bursuc, Windows Editor

Spotify Lost Millions of Dollars in 2009, US Launch Might Help

Spotify, one of the most popular music streaming services in Europe, is constantly

attracting new members from the seven countries it currently supports. However, it seems

that financially the company is not as prosperous as it might seem.

Spotify

can only be enjoyed in Finland, France, Norway, Netherlands, Spain, Sweden and

the United Kingdom, and this restriction means that inhabitants of other countries do not

have access to it.

The consequence is that the sources of revenue are limited, and even though, according to

a recently published

report

, the company's revenue for UK for the past year was $ 18.1

million, it actually translates in a net loss of $26.7 million, because of all the expenses, sales

and distribution.

In an attempt to minimize the significance of this financial report, a Spotify spokesperson

said: "2009 saw us focus on establishing a new and innovative music service and bringing it

to millions of people across

Europe

."

" The groundwork laid in our launch year has been crucial to the significant achievements

made in 2010. Further strengthening and expansion of the service remains our top priority,"

it was added.

Indeed, 2009 was a very profitable year for Spotify in terms of attracting members: at the

beginning of the year it had about one million listed users, and the number got to seven

million by the end of 2009, out of which more than 250,000 were paying subscriptions.

Truth be told, this rhythm has decreased during 2010, since Spotify has only recently

announced passing the

10 million users

threshold. In June, the company revealed that it

had more than 500,000 subscribers in the seven countries.

Despite still being popular and constantly attracting new users, it appears that Spotify is not

a very profitable company, at least judging by the numbers presented in the UK report.

Considering that a large part of Spotify's revenue goes to rightsholders, maybe a US launch

will help the company get more subscribers, therefore more money.

On the other hand, a new market always comes with increased costs and investments, so

this launch might prove to be a double-edged sword if it is not managed wisely.

In the end, users all over the world would surely rejoice if given the chance to access the

large array of features Spotify has to offer, so

US music enthusiasts

will definitely not pass

the opportunity to evaluate this streaming service - and be willing to pay for it, if it rises up to

their expectations.

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