With its recent entry in America, Spotify has turned up heat in the competition between online music streaming companies. Here’s a brief breakdown about the top 3 contenders. Rdio: “a new social music service” offers free on-demand streaming music, no registration, no credit cards, no downloads and NO ADS! Spotify: “your new music collection” Registered members have access to all music for free but must deal with both audio & visual ads. Rhapsody: “a digital music service” 14 day free trial, after that its $10 a month. The services between these 3 are pretty much the same, the costs may be different but it all comes down to the interaction with the service and their partnered social networks. The free trials or “Freemiums” are a way to get you to like their service, hopefully A LOT so that you wont mind upgrading to a premium account in the not-so-distant-future. Does this ring any bells? Think about Pandora, Hulu, Linkedin and so on. Apparently our irritation with ads should provoke us to pay for a premium, which may also give us access to even more music choices. Are consumers taking this bait? I personally use Pandora- the free version, I’m tolerating the ads due to the fact that I’m a marketer, I need to know whats out there and how brands are making use of different platforms. I recently joined Spotify and I love it! I love the fact that I can connect to my FB friends on a whole other level, we’re no longer poking or leaving useless posts on each others walls. With Spotify, I have access to my friends’ playlists, I get to learn about new artists that they love and I can share what I’m listening to, with the click of a button. Will this category become too crowded? Will we get so tired of seeing each others playlists on our FB streams? Over time these music streaming companies will have to choose between the users that don’t make the most of their “Freemiums” or the ones that use their free accounts to the max. The fence sitters (not using their accounts) are more likely become customers over time- more marketing efforts need to be used towards this group.

Freemiums vs. Premiums: The Battle Of Music Streaming.

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