Spotify Might Be a Splat on U.S. Music Market Windshield

Last Updated Jul 7, 2011 7:29 PM EDT

Pandora (P) has faced serious criticism of its business model and financials as it went public. One of the potential competitive threats according to its S-1 filing was "potential U.S. market entrants like [European streaming service] Spotify." Speak, and ye shall be heard: Spotify has announced its impending U.S. launch.

Then again, the service previously said that it would launch in the U.S. by the end of 2010 and there are no dates and prices on its current sign-up page. At one point, Spotify could have walked in and taken the U.S. music market by storm. But it didn't -- too many disagreements with the music labels that must grant rights. And now it's too late, because everyone is doing streaming.

OK, maybe not everyone, but take a look at some of the current competition:
  • Pandora lets you create stations based on types of music or performances, with free (but limited) ad-supported access. The paid version is $36 a year.
  • Rdio has entire albums to stream and playlists that people create. Cost is $5 a month for unlimited Web access or $10 a month for unlimited Web and mobile access, plus you can save favorite music on a mobile phone and listen while off-line.
  • Rhapsody charges $10 a month for unlimited Web and mobile app music and can provide not only individual artists, tracks, and albums, but genre streaming.
  • Last.fm (part of CBS Interactive, which owns BNET) has a free streaming browser option and a $3 a month ad-free version.
  • Slacker also uses a $4/$10 per month model and a free ad-supported version. The higher price brings albums and artists on demand as well as custom playlists.
And that doesn't even count online lockers from Apple (AAPL), Google (GOOG), and Amazon (AMZN) that let you store music and play it from wherever you are. (Well, at least if you have an Internet or Wi-Fi connection and don't have to depend on the lack of unlimited data plans by mobile phone carriers.)

What does Spotify offer? Little that you can't get elsewhere, and pricing that the company is testing. The one feature that could grab attention is the ability to send music links to friends so they can listen. But given the incredible head start that its competitors have, that probably won't be enough to succeed. The time for it to dominate the market is over.

Related: Image: morgueFile user gracey, site standard license.
  • Erik Sherman On Twitter»

    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.

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