Spotify Seeking Funding and Revenues

Previously we have written about Spotify’s upcoming Android application as well as their iPhone app, but currently Spotify is fast approaching its “payment due” day.

Spotify has been able to attract a huge amount of users but their free section is being used a little too much and they are now finding difficult to generate enough income to pay their major label partners by the date due.

Currently Spotify seem to be trying to increase incomes in three key areas:

1. A premium service is getting much more attention from Spotify as it adds additional features beyond just “ad free” to attaract paid users.
2. Spotify is rolling out by far its largest advertising format to date. It will feature wall to wall billboard ads on its music player that appear after just 5 minutes of inactivity as part of a major 3 Mobile ad campaign. (However, if I’m inactive on Spotify I tend not have the application open on my screen its just in a tab at the bottom, thus the ads showing will obviously have no affect whatsoever.
3. To buy more time, the startup is on the hunt for another $40-$50 million in venture capital funding. (paidContent)

I personally use Spotify and find it pointless to upgrade to their premium service because I receive unlimited listening time, tracks, search and playlists. I know they are finding it tough to gain additional revenues and maybe moving their product into iPhone and Android markets is a better bet to increase revenues fast enough.

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