Today in Social

Everyone’s favorite – but still not in the U.S. – music streaming service Spotify has capped its ad-supported product with number of listens and hours limits. Bobbie Johnson thinks it’s the end of ad-supported on-demand music, and PaidContent wonders if its relative success in converting free users to paid – 1 million subscribers in Europe – will suffer. Forrester’s Mark Mulligan thinks it’s a wise move to improve margins, and possibly set up Spotify’s long-awaited US entry by making a limited service seem less Spotify-lite. Spotify was never going to get the record label deals in the U.S. that it got in Europe, and so far licensing requirements limit ad-based digital music to a radio-like experience. (Full on-demand rights cost more.) Nor have the labels and publishers taken to discounting for scale. There’s a reason on-demand subscriptions haven’t gotten past a few million subscribers, even though Rhapsody and Napster are solid offerings. Unless the rights holders are willing to experiment with price elasticity, this is what digital music is stuck with.