Spotify Plans U.S. Launch, CEO Says It ‘Could Be A Billion-Dollar Company’

3 Comments

Credit: Spotify

The streaming music app that has been winning fans with free, ad-supported tunes is hiring U.S. staff and plans to open an office there in Q3 or Q4, CEO Daniel Ek tells The Observer.

Founded in Stockholm and run with offices in London, Spotify is so far only available in western and northern Europe and Scandinavia, but has gathered over two million users, most for its free service and not its £0.99 ($1.62)-a-day or £9.99 ($16.42)-a-month offerings.

Iironically, it may be easier for Spotify to win label licenses in the U.S. than it has been through the patchwork of European royalty territories. “Most of our deals are done from the U.S. anyway so I speak to these people on a weekly basis — I know them, I know their numbers, I know their wives’ names,” Ek says. But Spotify will find U.S. competition, including RealNetworks’ Rhapsody (though its free service only offers 25 songs a month) and Pandora, both of which are unavailable outside America.

Separately, Ek has made some further comments on Spotify’s possible financial future, perhaps easing up on the hope for profitability by this year: “We still hope to do that, but given the recession and so on, it might take a little longer.”

And, after we revealed Spotify’s VC search, Ek said on Times Online’s report that it is valuing itself at £200 ($121.4) million: “If someone’s willing to pay £200 million for it, that’s what it’s worth. But would I sell the business for £200 million? The answer is no. If it’s done right, this could be a billion-dollar company.” But with only a minority taking the premium options, and the free option threatened by the advertising recession, we’ll have to wait and see on that.

3 Comments

shalini

I know this start up has hype buy how can this valuation be possible???

Comments are closed.