Update on Spotify

Many observers are wondering if Apple’s iCloud deal might somehow cause the dam to burst and create flood of new music servicer deals from the labels. One of the more interesting cases involves Spotify. Reportedly, Spotify has signed a deal with its 3rd major label, Universal, leaving only Warner’s on the outside. The hang up, as ever, has been the free portion of Spotify’s service.

Spotify has roughly 1 million paid subscribers in Europe (out of 10 million total users). Subscriptions are €10/month. The labels are counting on a better batting average in the US. But even in Europe, Spotify is cutting back on the free stuff. European users will now get just 10 hours of free use each month, with a maximum of 5 repeats on any song. If and when Spotify gets that elusive 4th major deal in the US, look for similar restriction on free usage with a $10 monthly subscription as the alternative.