UPDATED 08:10 EDT / MARCH 30 2012

US vs UK: Music Cloud Storms Brew Over Fees, Licensing for Spotify and Pandora

The music cloud market is getting more crowded with each passing day, as several applications and services seem to appear from every corner of the world. Competition is getting tougher as companies are adamant about hopping on this lucrative bandwagon. Online streaming is one of the major crazes that has revolutionized our media consumption, and the music trend shows no signs of slowing down.

Spotify

Good news for Spotify fans in the United States—the app will remain free for an indefinite period of time.  The service will allow American music enthusiasts to enjoy unlimited streaming of their favorite songs from their favorite artists. There has been some speculation as to why the company suddenly decided to drop the potential revenue they could’ve earned by charging millions of users, choosing instead to keep it free a little while longer. The successful UK-based music streaming service landed in the U.S. soil sometime in July of last year. Since then, Spotify has remained a top cloud music service and never looked back.

And the international music service is building an ecosystem everywhere it goes.  Spotify’s influence emerged with promise as it helped Songkick lure over 100,000 new users. The latter developed a Spotify app, prompting significant growth in its fan base onc their partnership was inked three months ago.

Songkick CEO Ian Hogarth expressed his excitement over the output of the joint venture, saying, “We’re both focused on changing the music industry for the better. Whenever you launch something, it’s always a question of whether it’s going to catch … and this is really promising.”

Spotify also landed the top spot in the IPA online media owner survey. More than 80% of the respondents say that “My overall experience of dealing with this supplier is a good one.” A first since 2008, Spotify created a history all its own as they dethroned Specific Media at the number one position it held three years in a row. Spotify just keeps getting better with time.

Spotify also stole the headlines last week when it was reported that they’re shopping for a whopping funding round with a valuation of $3.5 billion. Several people find this insane, but Matt Rosoff of San Fransisco Chronicle has a different take on this issue, and actually believes that there is a potent reason behind the massive valuation amount, citing a few figures of his own.  Spotify has a global reach, having expanded in Europe and invaded Germany.  Their ecosystem is also extending as Spotify continues to reach out to developers with the introduction of “music intelligence” technology.

Muzzia

But Spotify isn’t the only music cloud floating over Europe.  Muzzia’s “juke” streaming music service is now moving towards Eastern Europe to capture the potential market here. With Muzzia, subscribers can instantly access millions of tracks from all of the major and independent labels on their smartphones (Android and iPhone OS), PCs and Macs.

Frank Taubert, CEO and co-founder of 24-7 entertainment shares his insights on these developments:

“Eastern Europe is a very exciting and relatively untapped market but it requires local expertise so we are very pleased to have found such an experienced and reliable partner as Muzzia to launch the streaming service. Their understanding of the region is a tremendous asset and will stand them in great stead to achieve success combined with our incredibly user-friendly service which will entice newcomers.”

Pandora

Pandora also had a few notable updates recently. Some are good and some are not so great. The music cloud giant has just ruled out its re-entry into the British market due to relatively high streaming music licenses in the country.

“The current rate demanded by PRS of 0.065 pence per listener per track equates to 47 percent of the revenue Pandora achieved on a per listener per track basis in the year we just completed, during which we generated $274 million (£172) in revenue and were the clear leader in monetising internet radio,” reads a PaidContent report.

Pandora believes that it’s still not economical for them to explore the UK with such fees. But, as the competition rises to the hilt, the music cloud pioneer remains optimistic in its value.

 


A message from John Furrier, co-founder of SiliconANGLE:

Your vote of support is important to us and it helps us keep the content FREE.

One click below supports our mission to provide free, deep, and relevant content.  

Join our community on YouTube

Join the community that includes more than 15,000 #CubeAlumni experts, including Amazon.com CEO Andy Jassy, Dell Technologies founder and CEO Michael Dell, Intel CEO Pat Gelsinger, and many more luminaries and experts.

“TheCUBE is an important partner to the industry. You guys really are a part of our events and we really appreciate you coming and I know people appreciate the content you create as well” – Andy Jassy

THANK YOU