Spotify hits 10 million paying users – here’s what you need to know

Online music streaming service Spotify has reached 10 million paying subscribers, doubling its user base in just 18 months.

The figures put the Swedish company far ahead of rivals Beats Music and Deezer, and will be cause for concern for companies offering paid-for music downloads.

The group also reported that it now has 40 million active users across 56 countries.

Users pay £10, €10 or $10 a month for unlimited access to the vast library of songs, or can use the streaming service for free but must tolerate advertisements every few minutes.

Daniel Ek, chief executive and founder of Spotify said: “Ten million subscribers is an important milestone for both Spotify and the entire music industry.

“We’re widening our lead in the digital music space.”

The figures lay down the gauntlet for Apple which dominates the paid-for download space with its iTunes service. In addition, Apple has been rumoured to be involved with a £3.2bn tie-up with Beats Music, the maker of the iconic Beats by Dr Dre headphones, and the company’s fledgling music streaming service which launched in the US in January.

Not up to speed with Spotify? Here’s the inside track:

  • The company was set up in Stockholm in Sweden in 2006, and the legal music streaming service was launched in 2008
  • The firm was founded by Swedish entrepreneur Daniel Ek, who set up his first company when he was just 14
  • Spotify is now headquartered in Soho, London
  • In November 2012, the company raised $100m from investors led by Goldman Sachs, after a $3bn valuation
  • However, the service has received criticism from several high-profile artists due to the revenue model. Spotify’s detractors include Radiohead frontman Thom Yorke, former Talking Heads singer David Byrne, Patrick Carney of the Black Keys, and former Smiths guitarist Johnny Marr
  • The service’s most popular artist is Eminem, Spotify revealed yesterday, and its most popular female artist is Rihanna
  • Record companies made $1.11bn from subscription services last year, up 50 per cent from the previous year, the FT reports
  • But streaming services are still very much in the shadow of paid-for downloads, and only account for a tiny proportion of the music industry’s $15bn in total revenues

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