Economist David Touve has been crunching some numbers to figure out how many active US users Spotify will need in order to equal iTunes’ music revenues there. This is based on iTunes’ estimated 70% share of the $2.5bn of consumer spending on music downloads in the US last year – so $1.7bn – and Spotify’s own figures showing that around 85% of its subscribers are paying $9.99 a month with the rest paying $4.99. The unknown: how much money Spotify makes a month from advertising to its free users. Thus, Touve comes up with three answers to the question: Spotify needs 30m active US users to out-earn iTunes if free users are worth $2.99 each a month; 35m active US users if they are worth $1.99, and 42m active US users if they are worth $0.99.
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Tools: Kaiber
In the year or so since its launch, AI startup Kaiber has been making waves,…