Swedish music streaming service Spotify is hatching plans to finally make a profit, and ramp up its defences against fast-growing Apple Music. Julian Satterthwaite reports.
Spotify is laying plans to finally make a profit - and keep Apple at bay. The Swedish music streaming service is a household name. With 30 million paid subscribers it's also the dominant player in its market. But Spotify has never made a penny, and now has fast-growing Apple Music on its heels. Reuters Stockholm correspondent Mia Shanley has been talking to the company: SOUNDBITE (English) MIA SHANLEY, REUTERS CORRESPONDENT, SAYING: "Their focus right now is really on their global domination and getting as many users as they possibly can, making streaming as mainstream as they can, so that they can have better leverage with the record labels." Spotify earned over two billion dollars last year from subscription fees and advertising. But it pays more than 80 percent of that to record labels and artists in return for music rights. Analysts said the company could get a better deal if it can hit 50 million subscribers. Spotify also wants to find other revenue sources: SOUNDBITE (English) MIA SHANLEY, REUTERS CORRESPONDENT, SAYING: "They're really moving into video. They're also looking at other ways they could make money, by perhaps selling concert tickets, perhaps looking at merchandise, at how they can get into the business of getting t-shirts and hats and gear to fans." Spotify raised about one billion dollars from investors earlier this year. So far its backers are keeping the faith. But history is littered with dotcom startups that were all promise and no profits. Sooner or later, Spotify will have to show that it can actually make some money.