Spotify and the Social Broadcast License

Last Thursday was the US launch of the fabled european music streaming service Spotify. Spotify is part stand-alone audio player like WinAmp, iTunes, or Windows Media Player; part online music library like Rdio, Rhapsody, eMusic, and MOG.; and part mobile audio player for iPhone, Android, and Symbian. Ok enough with the buzz-word hype-fueled nonsense. Basically, Spotify is an authorized version of the old Napster from 1999.

It comes in three varieties: Free, Unlimited, and Premium.

All levels of service allow playlist sharing and collaborative playlists. I think this is going to be the killer function of Spotify. Many times I go away for a weekend with friends, or to a bachelor party, or camping with friends and there is always a fight for the audio jack into the stereo. With a collaborative playlist anyone who is subscribed to the collaborative playlist can add a song to the playlist from their phone or computer without having to unplug the current phone that is plugged into the stereo.

There is still the issue of sharing playlists with local or unauthorized audio files, but this is where the real opportunity is from my perspective. Spotify could add an extra charge if users wanted to make their local files available to their friends via shared playlists. They could do so for an extra charge, to cover the added bandwidth costs and royalties.

The pricing could go something like this:
1 degree of separation = $1.99/month + Spotify Premuim
2 degrees of separation = $3.99/month + Spotify Premuim
3 degrees of separation = $6.99/month + Spotify Premuim
4 degrees of separation = $9.99/month + Spotify Premuim
5 degrees of separation = $12.99/month + Spotify Premuim
6 degrees of separation = $14.99/month + Spotify Premuim
7 degrees of separation = $19.99/month + Spotify Premuim

This would in essence be a Social Broadcast License. The idea is that users pay to give their friends access to their local music files, not that users pay to get access to their friend’s local music files. The main thing is that this is already happening. People are already sharing music with their friends. This would just allows them to do it with greater reach and simplicity, and it wouldn’t be a black market like it is today.

The future isn’t about getting more money from fewer and fewer major broadcasters.  It is about selling cheap licenses that turn everyone into a broadcaster.

Foster Hagey is a Techincal Consultant and Audio Engineer for Big Much Productions, Inc. and BigMuch.com. He works alongside songwriter and producer Peter Zizzo to help artists develop their music and get it heard.