Rhapsody's Irwin says Pandora's, Spotify's "freemium" approach won't work

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Issue Date: 
Jan 16 2013 - 12:25pm

From Issue:

Rhapsody Intl. president Jon Irwin told Inc. magazine he doesn't think Pandora's and Spotify's "freemium" model  (that's when a basic version of a service is available free, but a subscription is charged for the full-feature version) is the way to go.

Inc. reports Irwin believes Spotify's (and Pandora's) strategy is to "build a big name and a big user base by giving away the store, then do an IPO and leave the shareholders to figure out if the service can make money." He says his company's strategy is in building partnerships with automakers, mobile providers, and consumer electronics manufacturers (which, of course, Spotify and Pandora have done with wider success). Rhapsody did, in fact, launch its app for the Roku set-top device this week (more here).

Spotify has 5 million paying subscribers, plus 15 million more who use the service free. Pandora says in December it had 67.1 million "active listeners" (the vast majority of whom listen free). Rhapsody, which doesn't offer free usage, has 1 million paying customers.

Irwin reportedly revealed to GigaOm his company's plans to expand into 16 more European countries (see RAIN here) in the coming months (Rhapsody is available in the UK and Germany under the Napster brand name).

Read more from Inc. here.

Comments

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If there so no popularity

If there so no popularity for the product then the freemium approach won’t work. But pandora has so many viewers and I think its freemium approach may become successful. All the best for the new venture. Hoping for the best.Live in home care

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I have read this speech of Irwin and I think its true. In an article of cheap essays I had read similar things and discussions. Well, I hope any decision made is quite healthy for everyone.

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