In an attempt to adapt to the current trends of mobile Internet usage, Spotify is said to be on the verge of unveiling a free version of its music streaming service, with ads, of course. The details, however, might make the heads of users spin and might actually tarnish Spotify's reputation.
Offering a free streaming is no easy business, especially when one wants to stay on the good side of labels and record companies. But in the face of growing competition from Google Music All Access, iTunes Radio, Rdio, and a whole host of other services, Spotify is in great need of adjusting its rather antiquated pricing scheme. While Spotify did offer an ad-supported free version of their service, this was limited to the desktop. $5 a month is what it takes to remove those ads, and $10 will get you streaming to mobile devices. This system was set in place at a time when most users stayed in front of computers and not on mobile devices. Today, the numbers are reversed.
After what can only be a laborious negotiation process, Spotify has reportedly been able to strike a deal with a few major labels that will allow them to offer a free but restricted streaming service on mobile as well. There will definitely be advertisements involved, but the complexity comes from the nitty gritty of those restrictions. Sources indicate that users on the free tier will have limited access to songs, but that the restrictions will be not be so strictly imposed on songs the user has already listened to before. The rationale is that there is a heavier price to pay for music that one has never listened to before as compared to one that is simply repeated again and again.
If this has you confused, so will the users be, at least according to that same anonymous source. This, in turn, could prove counterproductive to Spotify's goal. But perhaps we're only getting a fragment of the whole picture, which is rumored to unveil on December 11 based on a mysterious invitation to a press event in New York.