Spotify, the popular European music streaming service, was originally planning to launch in the US by the end of 2010. As we know, that didn't happen. While Spotify has certainly made some progress towards launching stateside, a recent message from the company's Twitter account suggests that it still has some ways to go:
gdecugis: Ok so we've heard the story of @spotify but now tell us: when do you launch in the us??? #TNW2011
Spotify: @gdecugis No date set as yet, but we will be launching in the US this year
We're sure that Spotify has internal plans for a launch date but the fact that it hasn't even narrowed down its public timeframe to a given quarter this year is not good. Although Spotify is struggling, we think it has quite a bit of potential.
Google has been considering a partnership with Spotify to power Google Music. Spotify teaming up with Google would be great, as the former already has 1 million subscribers. The problem is that neither the search giant nor the music service has all the US labels on board.
Two months ago, Spotify reportedly struck a deal with EMI Music and three months ago, the company signed a deal with Sony Music Entertainment. Spotify thus has two of the four major music labels; the other two are Universal Music Group, the world's biggest label, and Warner Music Group.
US labels have hesitated to support Spotify's model as they don't believe it can be profitable. Spotify saw a huge financial loss in 2009. The music-streaming company enjoyed revenues of £11.32 million, but endured distribution costs of £608,711, cost of sales equal to £18.82 million, and administrative expenses of £8.29 million. The result was an operating loss of £16.40 million, and a net loss of £16.66 million after taxation.
