What I don’t understand is why they are raising this money? Do they expect that they are about to get into an all out war with Apple?
Someone is going to collect $10 (plus $1 or $2 increase every couple years) per month for a huge segment of the music listening population for basically the rest of our lives. Spotify want it to be them.
I personally doubt it. Exceedingly few markets are winner-take-all. Plus, monthly subscribers are "sticky", so they're not going to leave overnight if one competitor gains a slight edge, and everyone else will have a chance to catch up.
Your point about the labels and streaming services as middle men is a good one too. Labels own all the content, so they have a lot of power to influence the market as well.
What we really need are a change to copyright laws that requires a mandatory uniform-fee-only streaming license for all music, tv and movies.
You vote with your dollar by supporting the kinds of market you would like.
I started using Spotify in 2008 because the concept was what I envisioned for the future and iTunes was an awful practice in buying music. I thought I'd still "download" music on the side, but I honestly never felt the need for it. Sure Spotify doesn't have _everyting_, but it has an impressively huge amount of fringe music that I would never have expected and more than enough music for me to listen to until I die. And it grows.
Only independent labels without established names, who need the exposure from streaming as much as they need the money would suffer from a streaming monopoly.
Don't get me wrong - I'm not a fan of streaming services and prefer to own my music (a large part of which isn't available for streaming anyway) but for most people this is an incredibly fair deal.
I've gone with Google Music for this reason - my personal collection is in the cloud for streaming purposes (saved me the hassle of a home media server) - I occasionally buy new music from various sources and upload it to my account.
OTOH you can listen to hundreds of dollars worth of new music in a day if you want to, with no risk. If you pick something on a whim that turns out not to be good, just move on to the next album or artist. It's like going to a record fair with an unlimited budget, and a truck to carry your finds home in. There is a never-ending supply of crazy stuff on there.
If you use it like this, it's incredible.
Once smart phones came around and data plans approached a level where streaming music wouldn't explode your bill, I think streaming became a no-brainer. It still took me two years of having Spotify before I realized I could throw away all my old CD's that were eating up space, but once I reached that point, the value of streaming, at least to me, was pretty clear.
Sure, there are gaps in the music, but I think for most people, those gaps don't exist. And even for the layperson replacing their CD collection, having a Spotify/Apple Music/etc. account means having access to their music on any device, anywhere they go. Duplicating that kind of access with a CD collection is difficult.
Don't forget much of the world (I'm in the UK) already has generous enough data plans that many people stream without thinking twice. The US is an outlier in this regard.
Anyway, maybe I should try one of the free offers. :-)
unless you wrote it and played it you don't 'own' any music.
I am still paying for my downloads because I like weird artists and I think it is an important vote that I really like their music and want them to continue producing more. That is a luxury few afford anymore.
No competitor can offer $5/month unless the service is positioned as a loss leader. The overwhelming costs for streaming music is the licensing and royalties of music content. In other words, if Spotify paid their programmers half the market rate salaries to save overhead costs, they still couldn't sell online music for $5/month.
If "loss leader" is a legitimate business strategy, it means only the big companies with offsetting non-music revenue like Amazon/Google/Apple can offer cheap streaming music. Companies with music-only revenue like Spotify/Pandora/Tidal would not be able to compete with that.
Your monthly fees are now approaching $100 per month. However, you're still left with three gaps -- old movies, recently released DVDs, and movies in theaters. Considering all this, plus Sean Parker's idea to start renting new releases for 24 hours costs $50 per movie, it's pretty fair to say that Spotify is significantly cheaper than the equivalent in videos.