Is Spotify Killing Grooveshark? Take a Look…

A lot has happened since Spotify launched in the US last summer. That includes more than 13 billion streams, according to the company, the addition of more than a million paying subscribers, a splashy apps launch, and generally huge amounts of publicity.

Here’s what hasn’t changed that much in the past year: the number of US-based music fans. Which means that a chunk of those 13 billion streams came from elsewhere.  For example, Grooveshark, arguably a more direct competitor to Spotify than iTunes.

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That’s a 43.8 percent decline in unique visitor traffic in just one year, with the trend going sharply southward.  During that period, others in the streaming space like YouTube and Pandora have been clocking very heady gains, and deeper competitors like Deezer and WiMP are also boosting traffic.

Then again, this is just one measurement stick, and a direct comparison to the app-based Spotify is nearly impossible.  Indeed, Complete has its own methodologies and measurement flaws, and we’ve certainly pulled our hair out when things shift around.  That said, the Compete dataset seems to loosely correspond to a decline in page rankings as measured by Alexa.

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The political and legal backdrop is hard to ignore here.  Just last year at Bandwidth in San Francisco, a Grooveshark executive complained to Digital Music News of a coordinated attempt by the major labels to prop Spotify, and bury Grooveshark.  Sounds sort of like a conspiracy, especially given the completely different approaches towards major label licensing.  Then again, the majors are licensed shareholders in Spotify, and all are aggressively litigating against Grooveshark.

Perhaps these are just the early results the majors had been hoping for.