Eye On Spotify

Last week was a busy week for Internet radio. Clear Channel shook things up at the beginning of the week with their announcement of the coming “New iHeartRadio”, later in the week Spotify launched its US based service. While I think Spotify’s entrance here is interesting, I don’t think it will have an enormous impact on free streaming radio options.

Spotify’s on-demand service is more competitive with other highly interactive services that are looking to replace personal listening collections. Those include services like MOG, rdio and Rhapsody. Cloud based services that allow a listener to sync their own music files and stream from multiple devices are a competitor to on-demand services as well. Premium Internet radio services, such as Pandora One and Slacker’s premium ad-free option may also be affected, as I think they will compete for the same dollars.

More than 2/3’s of Internet users here in the US have paid for digital/online content already, according to The Pew Internet and American Life Project, 1/3 have paid for digital music online. That information validates the consumer subscription model. But how many different services will the consumer pay for? Probably not more than one or two.

In addition to all the streaming on-demand services competing for digital dollars, there are subscription based podcasts such as Adam Carolla, Bubba The Love Sponge and others.  In fact, I think Sirius XM, with its monthly subscription fee, is ultimately competing for the same monthly listening subscription dollars.

The arrival of Spotify, long heralded by themselves, has been anticipated by industry watchers aware of their large listening share in Europe. But the general public is largely unaware of them so far. Interest in earlier Euro based services has been weak – GOOM Radio launched and quickly fizzled, and UK born Last.fm, which CBSRADIO picked up a few years back, has not been able to build a massive following.

It’s an interesting case study from the get go, one that I’m looking forward to tracking..

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