Spotify, the legal streaming music startup that has wowed even Mark Zuckerburg, has now had its iPhone app approved by Apple, and now awaits an appearance on the App Store. How did they get an app approved which streams thousands of music tracks on demand and which potentially competes with iTunes? The short answer is no-one is saying quite how, but it’s pretty easy to surmise that iTunes won’t be affected since the app will only work for paying Spotify subscribers, who currently pay a premium subscription which currently stands at €10 a month in Europe. In which case Apple’s policy of blocking apps that duplicate native apps (like iTunes) would not apply. The green light from Apple now leaves the way open for Spotify to launch in the US, as it’s been planning, and attempt a massive change in the music industry for the record labels that have invested in it. No mean feat.
An Apple spokesperson has now confirmed the app is poised for launch in the App store and Apple “has been in constant communication” with Spotify prior to the launch. So TechCrunch would just like to say: we told you so.
As we pointed out when we reviewed the developer version of the iPhone application, Spotify co-founder Daniel Ek has said all along that they “have a great relationship with Apple” and Apple has already approved several other music services such as Lastfm, Deezer and Pandora. In addition, he said “we’ve spent significant time and resources to ensure we’ve stuck to Apple’s developer guidelines point by point.”
In other words Spotify had pretty much bet the farm on this app being approved and they would not have done so had they not got got the nod from Apple that the app was highly likely to be approved.
Here’s a official video of the app in action:
Spotify is now valued at €170 million, or about $242 million, with a post money valuation of around €200 million. That means the company has roughly doubled in valuation from a year ago, when investors bought stock at a €100 million post money valuation.
That’s not to say Spotify doesn’t have its sceptics. As our own Sarah Lacy, recently wrote, there are at least six “leaps of Faith” VCs have had to get over to invest in the startup, which has yet to leave Beta.
12h after every1 else announced it, TC losing it?
They had a server outage or something when the news was hot.
& about a week after I reported it…….
awesome, theyve just caught a premium subscription from me.
And me…I’m a HUGE Spotify fan http://tinyurl.com/n844y3
“it’s pretty easy to surmise that iTunes won’t be affected since the app will only work for paying Spotify subscribers, who currently pay a premium subscription which currently stands at €10 a month in Europe”
Wait, what ? That doesn’t even make any sense.
Universal in Sweden make more money through Spotify than iTunes. Unless people want to argue that one doesn’t cannibalise the other (good luck with that), I don’t think there’s much more to add.
This could turn out to be very positive for Apple.
It is my understanding that Apple generates more revenue from iPhone sales than iTunes sales. By opening up the iPhone to other media services, they could ultimately position the iPhone as THE premium multi-media device on the market & generate tons more iPhone sales.
Isn’t it already the premium multi-media device on the market?
i get the feeling that Apple is letting all these music streaming companies have their day in the sun before they drop a nuclear on their head with this cocktail project. Apple has the music industry by the balls. They aren’t going to let that get away from them.
I agree that Apple has a quiet confidence with the cocktail project. I believe the new iTunes is being released September 8th? Somebody correct me if I’m wrong.
Even though the application is only available to paying subscribers, its still surprising that apple have allowed it to feature on the iphone. Surely itunes and spotify are in direct competition with eachother? This move does not make any sense to me on apples part.
I wouldn’t be so sure as to the “not make any sense part”: Apple barely make any money of the music they sell on iTunes, however the music has always been a way for them to sell more high margin hardware.
Spotify on the iPhone will surely just make sure Apple sells even more iPhones..
The constant communication with Apple could be the reason that the android app hasn’t been released yet, a 6 month exclusivity deal maybe?
The android app was finished months ago and had no barrier to entry other than using it to sweeten the deal with Apple.
It doesn’t sound like this is the case.
When the unofficial “Droidify” app got pulled from the Android market last week, I chatted to Daniel Ek (one of the founders of Spotify) via Twitter and he basically said…
@SteveBrammer hold out for the official Android app. I promise you that you won’t be disappointed!
I then asked him the following…
@eldsjal Will you allow the official Android app to be released before the iPhone app if Apple’s approval process takes a long time?
To which he replied…
@SteveBrammer I think we’re going to keep our timeline with Apple so hopefully we don’t need to release them at different times.
This would seem to suggest that they are looking to release both iPhone and Android apps at the same time. I hope he doesn’t go back on what he said.
But wait, doesn’t this “reproduce the iPhone’s native functionality”
?
I can’t wait for this and Lala to hit the U.S.
Consumers are increasingly running to these “cloud” services for everything from photo archiving/editing to phone calls to web design to gaming. Apple have dragged their feet because they are behind the curve, plain and simple, and they don’t want their devices to be shiny conduits for other people’s (profitable) software and services. But they have to cave because they know that the competing platforms would gladly welcome such services.
how long has spotify been in beta?
This is significant on a couple of levels – apple either dont see this as competition or arent making enough from iTunes music (more from the hardware) and secondly could impact the gradual decline in illegal music downloads. Very exciting!
I wonder how long you’ll be able to use Spotify on the iPhone before the battery runs out. I’ve been using Boombox Pro (streams blip.fm over 3G) and it’s a battery hog. My fully charged second iPhone 3G runs out of juice after maybe 1,5 hours.
Let the music ownership vs music access battle begin!
Can’t wait for this app. Been a spotify subscriber for a few months and I love it. The service is fair priced, and heaps of great music. This will be my number one app for a long time. If this app hadn’t been released for iPhone I would easily change my phone.. Besides iTunes might get their share of my money, as it’s highly probable I’ll want to burn my favorite playlists onto cd’s. Thanks Apple and spotify!
It is NOT AVAILABLE in US. I am not holding my breath for iphone app
Perfect time to submit.
Spotify will be popular in the US and will probably be more so than any of the other services like it are. But that said I don’t believe it will be wildly popular or any real threat to iTunes. Europeans tend to go for his type of service more than Americans. Europeans by and large don’t have as much disposable income as Americans and so can’t afford to buy as much and see this type of service as a way to save money. Plus European tax rates and cost of living makes excess money slim. Americans tend also to believe in personal ownership more strongly thus owning is preferred to renting. Europeans tend to be more socialist and believe the government should take care of them thus tend to gravitate to programs that are welfare in style so that everybody can get some.
Yeah that’s right. Spotify will be more popular in the US, because here in Europe we are all sooo poor and are all socialists. Oh and I suppose because the NHS is evil we won’t like Spotify as much either. Hmmm…. I smell shite… yup, definitely shite!
With the iLike/MySpace deal this is obviously attractive to Mark Zuckerberg!
Does anyone know which third party app developer Spotify used to develop the iPhone and Android apps?
We are looking to experiment with something similar in the movie space.