From what they've said, it's about "spotting" and "identifying" music and music trends. But it seems like mostly it was just a somewhat nonsense word that was easy to remember and whose domain name was available.
Especially since it's popular as a paid service without ads.
So, while "spotify" meaning to add ads, might be fun theory, it does make a lot of sense from nordics point of view..
Swedish is Scandinavian/Germanic, close to Norwegian, etc (Finland is Nordic, but is not Scandinavian). Finnish is Finno-Ugric, close to Estonian and Hungarian (yes).
According to Ek, the company's title was initially misheard from a name shouted by Lorentzon. Later they conceived a portmanteau of "spot" and "identify".
IP laws are broken, keep extending protection, and do not prevent distribution exclusivity.
I could sell a license to Bob who can sell my arts to you. But I won't give a license to Alice to even be able to enjoy the art for the fee I charged Bob, and I can tell Bob to do the same and not give it away to Alice at any cost. The law would say that's fine, and let's even arrest Bob if he ever sells to Alice.