Spotify will ask record labels for help in turning a profit. And the labels just might grant it.
Major label sources have confirmed to Billboard the points in a recent report at the Verge: Spotify will seek lower licensing rates and an extension of free streaming to mobile devices when it meets with record labels for U.S. renegotiations in the coming weeks. Spotify did not comment for this article.
Spotify’s inability to turn a profit and the possible pitfalls of its business model have been well documented in the media. The company’s 2011 filing showed a net loss of €45.4 million ($35 million) on revenues of €187.8 million ($144.9 million). U.K. income statements showed an operating loss of £2.1 million ($1.4 million) on revenue of £91.5 million ($58.9 million).
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