Not to be outdone by Beats Music's recent, if modest, price reduction on the heels of its acquisition by Apple, Spotify has announced a far less demure drop of its own. Beginning today and ending June 15th, the service is offering customers three months of its premium service for $9.99, a two-thirds reduction.
Spotify will no doubt be facing an uphill battle under ever-increasing gravity to grow and retain its subscribers during what will likely be an onslaught by Apple, a company that can afford to pay $3 billion for a marketing engine, music streaming service and handful of executives -- not to mention the possibility of offering Beats Music as a siginificant loss leader in order to keep its own customers happy within the aging iTunes ecosystem. Spotify, after securing a $250 million investment, has been valued at $4 billion.
Two weeks ago, Spotify posted an increase of 4 million subscribers year-over-year, largely driven by mobile usage -- which just happens to be Apple's specialty.
And, while Beats only has 250,000 subscribers -- according to Jimmy Iovine and all U.S.-based, as the company hasn't entered any other market -- to Spotify's 3 million in the U.S., Apple's wallet and Jimmy Iovine's inarguable success in the music industry both promise a serious fight.
But Spotify's recent launch in Brazil, as well as a still-brewing debut in China -- as Rdio CEO Anthony Bay characterized it, "it takes a higher degree of work and investment" to operate in that country -- and its position as the dominant music service, means the competition is far from over.
And, even with all this simmering competition, Spotify founder and CEO Daniel Ek doesn't appear too worried. "We’re not fighting over market share here. The music industry is still smaller than it should be. And in the UK, we’re seeing that streaming (and we) are already growing the overall pie," he told Billboard when asked about Apple's Beats purchase.