Spotify, the beloved European music streaming service, made a shocking announcement today, crippling its free option.Free listening hours will be halved from 20 hours per month to 10 hours, and users will be able to listen to an individual track only five times.
There’s only two possible explanations for this: labels or cash.
It’s possible the labels have pushed Spotify, which isn’t commenting to the press, to crack down, maybe as a condition of letting them launch in the US.
Or it’s possible Spotify just wants more of its free users to pay and is nudging them in the right direction. But the company just raised $100 million so it can’t be in a scramble for cash.
But it’s hard not to see this as a bad move. Spotify is competing against a product that is 100% free — pirated music — and its key selling point is its convenience. It’s already converting free users to paid at a high rate of 15%. The goal isn’t to get more of the existing users to pay, it’s to get more free users.
Update: TechCrunch Europe’s Mike Butcher quotes a source: “the labels put a gun to Spotify’s head.”
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