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Rumored revamp of Spotify’s free mobile service could be a big step up

Spotify is in the middle of a busy time. The Sweden-based music streaming company went public earlier this month, and now it’s gearing up for a big event in New York City on April 24 in which it could unveil the company’s first-ever piece of hardware.

The gathering could also see it reveal a revamped version of its free mobile service that gives users better access to tracks, people familiar with the matter told Bloomberg this week.

The updated software would in some ways mimic the paid version, the report said, offering more control over what you can play. At the current time, the free ad-supported version of Spotify’s mobile service prevents you from selecting tracks, leaving you with no choice but to listen to what it serves up via shuffle when you pick an album or playlist. In addition, you can only skip tracks up to six times during each hour of use.

The inability to choose specific tracks is the main drawback when it comes to Spotify’s free mobile service, but the company knows that it’s this very limitation that prompts some users to switch to its paid model costing $10 a month.

As Bloomberg points out, the company needs to attract new listeners to reassure investors that the business is continuing to grow, and making the free mobile version more attractive could be one way to go about this.

The tricky part will be converting those users to the paid model, which is where the real money is made.

Spotify’s paying subscribers brought in around 90 percent of the company’s revenue in 2017, despite making up less than half of its customer base, which at the last count totaled 157 million people. Spotify is aiming to exceed 200 million users by the end of 2018, and also hopes to have 96 million of them paying the monthly subscription fee, up from the current 71 million.

A major increase in its subscriber base is absolutely essential for Spotify, a company that, despite growing revenue, has been losing huge amounts of money in recent years.

Notably, Spotify’s main rival, Apple Music, doesn’t have a free tier, so improving its current offering for newcomers could prove to be a smart move for Spotify as it endeavors to stay ahead of the competition.

There’s no official word from the company about the reported change to the free version of its mobile service, but we should have a clearer idea of what’s happening by the end of this month.

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Trevor Mogg
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