Spotify was created in 2006 By Daniel Ek and Martin Lorentzon
Spotify was created in 2006 By Daniel Ek and Martin Lorentzon, in Stockholm, Sweden. The name comes from a combination of the words ”Spot and ”identify”.
Spotify was launched live in Sweden, Finland, Norway, Spain, and France in October 2008. Few months before, platforms used by the public to share digital content like Pirate Bay were brought to court (Kravets, 2008), and the European Union reformed anti-piracy laws. This was an excellent opportunity for Spotify to gain popularity on the market as a platform that can access and offer the majority of global music for a small monthly fee. “It wasn’t just that it was now illegal. People discovered Spotify and realised it was better than piracy” (Lynskey, 2013). Spotify is operating right now in 65 countries.
The platform begun offering free accounts and customers could only join the platform by invitation; this was to control the growth of the service. Simultaneously, Spotify was closing deals with the biggest Music labels, Spotify has to raise more than £138 million during its first and pay the royalties to labels in advance to guarantee the launch of Spotify in the US the year after. (Constine, 2017).
Spotify has Freemium Business model, which means it offers essential services for free with option to upgrade the account to premium and have access to all the services of the platform under certain amount that may change depending on the country (Spotify usually charge 9.99 in every country, the only thing that changes is the currency £, €, $). The revenue of Spotify is coming from the advertising and the fees received from premiums accounts.
At the end of 2013, Spotify launched a new feature, ”Spotify for Artist” which allow artists to have access to their data, the number of streamings for each song, revenues, visitors on the profile, the listeners from each territory.
At this stage, Spotify has more than 35 million songs and an estimate of 180 million registered users. Besides, Spotify announced to have 83 million paying subscribers in the world, which is an impressive number in comparison to the figures from their competitors