How Much Money Is Spotify Making?

Spotify has released mobile applications for two platforms today - iPhone and Android - and is set to launch one for the Symbian S60 soonish. This brings up an interesting question - how much money is Spotify is making?

The BBC revealed today as it announced the release of Spotify's first mobile apps that the Swedish online music outfit has eight million users across Europe and that a mere two percent of them were premium users (that's 160,000). Earlier this month, Techcrunch reported that this number was just under 100,000.

Using best case scenarios, this means that the company would be pulling in up to £19 million per annum all things equal (that's 160K x 120 pounds for the premium subscription).

Alternatively, that could mean £160,000 only if everyone's going for the 1-day Spotify pass. Arguably, the truth is somewhere in between and since Spotify hasn't disclosed its figures yet, we're left with our blank canvas.

But Spotify Sweden, which has more than one million members, has already overtaken iTunes in Sweden for Universal and Sony when it comes to revenues.

This prompted Per Sundin, head of Universal Sweden, to declare ecstatically back in August that “In five months from the launch Spotify became our largest digital source of income and so passed by iTunes”.

We can therefore infer a few things; either Apple is squeezing revenue for record labels in Sweden or iTunes is not popular there. It could also be that the number of paid for members in Sweden is significantly higher than in the rest of Europe.