July 14, 2011 | By Julie Samuels

Spotify's U.S. Launch Highlights the Good, the Bad, and the Promise of Subscription-Based Music Services

In case you missed it, Spotify's long-awaited U.S. launch is here. Spotify now joins the ranks of services like Rhapsody, Rdio, and Mog that allow users (for a fee) to stream unlimited music from multiple devices, make and keep playlists, and store music on mobile devices.

This is good news for music fans. Spotify has already proven successful in Europe, and, unlike its current U.S. competitors, provides a free, ad-based service where users can access a certain amount of music each month (after that, users can pay for unlimited songs and to have access on their mobile devices). This is just the type of product the record labels have failed time and again to offer their fans: convenient access to different amounts of music, to be consumed in different ways, at different and relevant price points. Instead of being forced to buy full-length CDs at $15.99, fans can now make their own decision about how much they value music and how much of it they want. Of course, the record labels could have launched a service like this years ago. Instead of innovating, they famously sued their fans (and reportedly fought Spotify's U.S. entry) and are now left watching revenue go to others, despite their oft-repeated claims that they could not “compete with free.” Yet, multiple streaming services, music lockers, and others have found a way.

While we are glad to see more choices for music fans – and hopefully more ways for artists to be paid – we still have some major concerns. Chief among them: users' rights to port their data. Because streaming customers do not own their music, they cannot take it with them. Should they decide to try another service (or if a service goes under), users should be able to easily export titles of songs in playlists they created or a list of favorite music, etc. Users should also be able to choose independent add-ons that make the service more valuable, such as alternative means of organizing their music "collections." Without this kind of functionality, users are going to be disappointed, and we are unlikely to see the real competition that helps drive innovation.

More robust network connections, the popularity of tablets and smartphones, and the hype surrounding Spotify lead us to believe that streaming music's time may have come. But if users lose access to the work they’ve invested in searching through music catalogues, setting up playlists and favorites, and otherwise managing their music-listening habits, downloading music (legally or not) will still be a better alternative for many. We urge these new content companies to provide their users tools, such as convenient data portability and support interoperability. Then at last, we might be able to show the record labels that it is indeed quite possible to "compete with free."

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