Plans to launch European music streaming service Spotify in the USA have been temporarily scuppered by Big Music.
According to Telegraph sources (opens in new tab), Universal, Sony, EMI and Warner have thrown a spanner in the works because they are not comfortable with the outfit's advertising-sponsored free service and have demanded huge buckets of cash up front.
An anonymous senior music executive told the newspaper: “The US divisions of the major record labels do not feel comfortable with the freemium model and have demanded extremely high cash advances, which has caused Spotify to stop and think about whether it can afford the move to the US and indeed whether it is worth it."
Spotify was due to launch stateside in 2010, but a spokesman said: "It's taken us longer than expected in the US but we’re working hard to ensure we launch with the best service possible.”
As well as its free service, Spotify offers European music fans a £9.99 per month unlimited streaming plan that supports mobile use as well as PCs, or a £4.99 version which kills the ads but doesn't do mobiles.
It has been suggested that the music labels have deliberately set cash advances and minimum payment guarantees at ridiculously high levels in order to make the launch untenable.