Not sure your model works.
Also, I'm uncertain that millions or hundreds of thousands of people really do pay £40per month for rapidshare/usenet accounts. I'd like to see some evidence for that claim.
This only makes sense if you're talking about someone with tragically limited tastes in music. There is no way you could ever listen to "all the music you want" in a lifetime, let alone one measly month.
There is more good new music produced and released in a month than you could listen to in that month, before you even consider the entire history of recorded music that already exists.
I know a few usenet/rapidshare service subscribers, they download more HD movies per month than they could watch if they sat there 24x7 watching them, never mind the amount of music they could download if they turned their attention to it.
And this is essentially a thought experiment - extend it out to a year, where you're downloading 24/7 and what I'm saying holds true. Paying a fixed amount for (legal) unlimited DRM free downloads isn't a model that's going to work.
And it doesn't make sense to consider someone downloading 24/7 because unless you're on dialup, you can download a lot more than 24 hours of music in 24 hours.
However it is clear than the value you get from spotify and similar services is very much determined by your attitudes to music. If you cast your net wide and look for gems from across all styles and niches of music, then it's easily worth it. If you just want to listen to indulge your relatively static tastes in the one or two areas of music that concern you, then its a less obvious choice.
The question is, are there enough obsessive people who are into Music in the wider sense, and have a need for on demand "random access" to any and all artists/genres, to sustain spotify? Because they are the people for whom the service makes sense. People who want to listen to the same 50-100 albums on rotation are unlikely to be persuaded by the pricing model.
PS. Yeah, "tragically limited" was a thoughtlessly flippant thing to say. Didn't mean to be so condescending. Compare it to the attitude of a hacker looking down on someone who doesn't feel the need to learn anything except Java because it "does the job" :)