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December 07, 2010

Daniel Eck - Spotify. (Peter Kafka)

Daniel Eck - Spotify. (Peter Kafka)

Can't get Spotify in the US today. We have technology and business problems to solve at the same time. Won't commit to a specified date for the US launch.

20 hours free streaming music per month for ad supported service. In the US it will be $10/month.

Lots of speculation about the company: not looking for more funding now but wouldn't rule it out in the future.

Sounds like Rhapsody, Napster and others. Daniel: music is popular and a lot more spread out in terms of genres. So that is why we think there should be a consumption model now. Napster started that. Nw we have broadband in our phones as well. People want to have access to everything on every device. Pandora becoming widely successful because of smart phones. Independent of the type of media, people just consume more of it. Overtime we are going to figure out all these differny ways for producers to get value.

We have a bit more than 750K paying customers paying us 10 Euros. We have 10mi users. The most important thing for me is that the value of the access model is to get people to build their library. We introduced the portable subscription model in Sep 09. People are actively sharing their library. It is about convenience and accessibility. It is a service that is inherently social. Twitter and FB and other social networks have had a huge impact on people's ability to share content.

Two huge platforms - the social platforms and all the mobile devices together fuel growth.

DEMO - showing downloaded playlists. It's a very simple experience they want to download their collection, have it available and it is not a fixed amount of music it is an infinite amount of music and ve ry shareable.

Question: about being offline due to service provision issues. Daniel: service level and avail is a huge issue for all social networks. We use peer-to-peer infrastructure. Our users tell us that we provide their music faster than if it were on the device. I think there are two problems with music: one is format and the other is device. I don't think that people buy a CD is for collection it is because CD is ubiquitous and it plays anywhere. This is a foundational idea behind Spotify. Play anywhere. We are at this fragile state of the web, everyone expects everything for free, we are moving towards a paid model. Apple app store and it is almost a curation of paid stuff.

Question: is Jobs campaigning against you? Daniel: I read the news but the label guys are not telling me that. I don't focus on that, I focus on product and doing so as a user and building the product that I want. For all forms of media we need to make it as easier to discover and play anytime anywhere.

The vast majority of users do not pay for music today. It strikes me as odd that the value of the entire music industry today is around 15Bi dollars. We need to build a legal service.

The US is the world's largest music market and it just takes time. We really believe in our model - listen, share, discover, social. We would not just launch a subscription model. Free matters, short trials don't work. You Tube is one of the biggest music players in the world. Yu Tube has become a music player but not an effective one. Radio is mostly free. We just want people to build their library, to build a much bigger collection.

On Sean Parker. I just saw the Social Network it is a great movie, I'm not sure it is true. Sean wrote me this really long email explaining what was wrong with the product. He is so great at product and great to have him around to bounce ideas off.

Question: Sirius and their business model. A: I haven't played with them much. Sirius has some great and unique content. I am an inherent believer in Internet as distribution.

Rob Glazer: why haven't labels given o the same deals here? A: labels see what we see. If this is going to move on to be the next big thing then the want to get it right. Rob: I have a different answer that I will share privately.

We are a developer on the Facebook platform. Our one criterion is that we would never want to do any exclusive deals. We want music to become like water. We think music is the most social object and could even surpass photos. They are paying with attention or money today. We want to be on more devices - today a lot of devices out there and the majority are not music enabled.


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