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Yahoo tunes into Spotify

June 26, 2012|By Alex Pham
  • Yahoo agrees to distribute Spotify's music service to its 700 million users.
Yahoo agrees to distribute Spotify's music service to its 700 million… (Yahoo )

Yahoo on Tuesday tapped Spotify to fill the gap left open when the Silicon Valley Internet media company killed its Yahoo Music Unlimited digital on-demand streaming service in 2008.

The deal lets Yahoo distribute Spotify's popular music service to the 700 million people who visit its site each month.

"Delivering compelling premium experiences across screens is core to our mission at Yahoo," Ross Levinsohn, Yahoo's interim chief executive, said in a statement. "Spotify is the leader in the digital music field and together we can provide the 'soundtrack' for users around the world."

Yahoo, which launched its Music Unlimited service in May 2005, retreated from the market less than three years later, citing an inability to attract enough paying subscribers. Among the obstacles: electronic locks on the songs required by record labels at the time made the music service incompatible with Apple's iPods.

While Yahoo bailed on its subscription music service, it continued to produce and aggregate editorial content for its Yahoo Music destination, where Spotify's service is offered.

For Spotify, the distribution deal dovetails with the Swedish company's plans to reach as many people as it can with its free service, then reel them into its premium service, which costs about $10 a month for unlimited access on mobile devices, among other perks.

The company boasts 3 million paying subscribers out of 10 million active listeners.

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