Kara Swisher

Recent Posts by Kara Swisher

Is Spotify Spot On? Co-Founder Daniel Ek Talks About the Hot Online Music Start-Up!


There’s no question that Spotify is the latest hot start-up of the moment, which would be super annoying to BoomTown–who is easily irked by never-ending froth around Web 2.0 companies–if co-founder Daniel Ek were not so sharp and the digital-music-on-demand service he created not so nifty.

But, indeed, Ek turned out to be a very refreshing and level-headed serial entrepreneur in an interview I had with him yesterday in London, where Spotify has an office.

While Spotify is only available in certain countries in Europe, Ek promises it will soon come to the U.S., presumably when he finishes negotiating with the major music labels–which all reportedly hold stakes in Spotify.

They would like it, given that Spotify is essentially a kind of not-iTunes, a label-friendlier version of the popular music-downloading software and service from Apple (AAPL).

So, it is probably likely Spotify will get the green light for its American invasion, especially given its strong performance in under a year, with several million users, mostly in the U.K., as well as Germany and Sweden.

Those consumers seem to like the simple and light software application that lets one find and play a terrific range of music instantly. (Spotify also recently released an iPhone app for mobile users.)

The innovative service is somewhat social and too light on recommendations, but the true appeal is the quick ability to build an eclectic online music library and discover new songs without having to spend a lot buying tracks.

Those who pay a monthly fee get those millions of songs without advertising, while those who use the free version get banner and audio ads. Spotify also makes money from users downloading songs and by spurring physical sales.

While it is still unclear if all this adds up to a big business–the online music business has been notoriously deadly to start-ups–investors have pumped tens of millions of dollars and given Spotify an alleged $250 million.

The start-up has also attracted the attention of U.S. Web hotshots, including Facebook founder and CEO Mark Zuckerberg, who complimented it on his status update recently.

Other big companies are also likely to take a look-see at Spotify for acquisition.

The 26-year-old Ek insists he is intent on building a huge standalone business. Famous last words, of course, but he talks a good game, as you can see in this video interview: