A new financial report released by Last.fm in the UK indicates that they lost £2.84 million in 2009, which amounts to somewhere around -$4.4million. Add that number to the $280 million that CBSRADIO paid for Last.fm as a purchase price. 2009 revenues were £7.28 million, of which 74% was from ad sales, 18% from subscriptions and 8% from affiliate sales. Geographically, 55% of Last.fm’s revenue came from the UK, 33.5% from the US, and most of the remainder from other European countries. CBS has trimmed expenses at Last.fm substantially from the more than $13 million pounds they spent in 2008, by reducing the number of employees and revising the platform toward less and then no on demand streaming.
Spotify, the on-demand streaming service that has taken Europe by storm but has yet to enter the US market, filed a report indicating that they lost over £16 million last year, making the Last.fm operation look not so bad. Spotify’s revenues were £11.89 million in 2009, and revenue was split between ad sales (40%) and subscriptions (60%). Spotify has more than 7 million registered users, 250,000 of which are paying a subscription, which translates to a 3.5% conversion rate from free to subscription based listening.