The freebie party shall go on!
But, who’s paying this bar tab, exactly? On Thursday, Spotify opted to extend unlimited free listening in the US – indefinitely. “We’ve been so overwhelmed by the US response to Spotify that we’ve extended the honeymoon for unlimited free listening,” the company blogged. “Right now, if you’re a free user, you can continue to enjoy millions and millions of tracks without time limits, gimmicks or catches.”
Sounds like a pricey move, though Spotify may feel completely confident that premium conversion rates will remain aggressive. The company has been somewhat cagey about its total active userbase, but quite clear on its global subscriber growth. Which looks, impressively, like this (as of January).
And make no mistake, this is a land grab. Because Spotify wants America… all of it! In the US theatre, Spotify is quickly catching up to Rhapsody, whose freebie giveaways are far more limited. But then again, so are its finances. The move comes alongside leaks that Spotify is chasing another gargantuan funding round, potentially exceeding (another) $100 million.
All of which supports a business model that’s starting to look like a massive gamble. “This is a healthy model,” Spotify chief content officer and US managing director Ken Parks told the Financial Times earlier this year. “As it scales it gets better for everybody.”