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Summary:

The latest rumor to hit says Apple might be interested in buying Spotify, a hot music startup based in Sweden. There’s news that Google almost bought them for $1 billion last year. What does the company say to all that? It’s not for sale.

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It’s perhaps a sign of the times that whenever we think of startups — however big or hot they might be — we think of them getting bought by another cash-rich company. We don’t think of them as freestanding, long-term businesses. A few weeks ago, it was Groupon being acquired by Yahoo, and last night there were rumors that Apple might be kicking the tires on Spotify.

If that wasn’t enough, Michael Arrington is reporting that Spotify almost sold to Google for about $1 billion last year. It was around the time Apple acquired the streaming service, Lala. So what does Spotify have to say about all this? Jim Butcher, communications director at the company, wrote in an email:

We wouldn’t normally comment on this kind of speculation, but we wanted to make it clear that we have absolutely no intention of selling Spotify. We’re working hard to build the best music service we can and are in this for the long haul.

Spotify has raised over $50 million in funding and is rumored to be profitable based on its European operations alone, but has struggled to find a toehold in the all-important U.S. market. Anyway, when I think of acquirers for Spotify — and there are many who would want to buy this company — Amazon and Nokia are better suitors than say Apple or Google. Of course, there are several other music startups which might be available for sale too; Rdio and MOG are two that come to mind.

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  1. why wouldn’t netflix buy them – worth a billion to them to get in to the music business the *right* way.

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  2. Based on Netflix’s ability to continue growing at a high rate without buying threatening startups and competitors in its space, I think we are seeing that the company may be able to continue growing and realize success by simply contracting license agreements and rights to distribution. The Netflix streaming service is already coming pre-installed in many of our home entertainment products. I think that if Netflix decides it wants to offer albums or songs for streaming, it will already have such a massive avenue for distribution in place that the only variable potentially holding it back would be exclusive licenses to stream music that were already awarded to another entity. I am not sure if such exclusive contracts are currently flowing through the industry. I do know that different streaming servies with monthly subscriptions offer many of the same songs. Does anybody know the details of such relationships between record labels and these streaming services?

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