Spotify is raking in between £1 million to £6 million a month, according to research by law firm Pinsent Masons.
The figures have been revealed on the firm's website Out-law.com.
The research into the site's earning potential all stems from Spotify confirming to Out-law.com that it has 6 million users and the revelation that its subscription base hasn't hit 10 per cent yet but is in "six figures".
This is according to Spotify's Director of Content Niklas Ivarsson, who was speaking this week at a Scottish Society for Computers and Law (SCCL) event in Edinburgh.
Figuring it out
Doing some basic maths, Pinsent Masons now believes the website is earning up to £6 million a month from its subscribers, as it costs £9.99 for a subscription.
Spotify's business model of offering both free music with adverts and unlimited content through subscription has garnered vast amounts of interest, as it seems to be succeeding when the music industry is in dire straits.
Other Spotify-based revelations have come from the Guardian today. The newspaper has posted its thoughts on how much Spotify costs to run.
It believes that it costs the company on a monthly basis £126,000 to stream, £600,000 in music royalties and around £100,000 to host the site.
Whatever money changes hands to make the site work, it all makes for interesting food for thought the next time you use the service.
Via Out-law.com and the Guardian
Your comments (1) Click to add a new comment
craiggrannell
October 8th 2009
1. Gotta love that kind of estimate - bit of a difference between £1m and £6m. Also, £1m is pretty much a break-even figure.
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