May 31, 2012

Napster Co-Founder Admits Apple Tried To Block Spotify

Michael Harper for RedOrbit.com

Daniel Ek and Sean Parker–co-founder and Director of Spotify, respectively–took to the red chairs last night at the All Things D conference and were interviewed by the Wall Street Journal´s tech journalist extraordinaire Walt Mossberg. During the interview, Mossberg took the time to ask the two streaming music providers about their legal negotiations in the States and their relationships with the record labels. Surprisingly, Mossberg was also able to get the pair to admit to a struggle they encountered with Apple. According to Ek and Parker, Apple had tried to prevent UK-born Spotify from landing on American soil.

"There was some indication that [the act of blocking] might have been happening,” said the former Napster co-founder and Facebook president.

In the video, Daniel Ek sits nervously next to Parker as he mentions the alleged blocking by Apple. “I can get away with saying things,” said Parker.

Not surprisingly, Apple had no comment about Parker´s statements.

“It's actually a very small industry in a lot of ways. Certainly more than 10 to 12 years ago. It's a handful of guys really running the record business. They tend to talk amongst each other about this stuff, and one of our core competencies is our negotiations and legal framework,” continued Parker.

“We wanted a never-ending negotiation -- we're always in negotiation. In that process, you hear things, and people send you emails. There's definitely a sense in which Apple was threatened by what we were doing. But realistically, what we're doing is such a small part of their business, it wouldn't be hugely significant to its bottom line."

Ek and Parker admitted Apple could, at any moment, flip a switch and turn on a very similar service to Spotify. The pair didn´t seem too worried about this possibility, however.

"If you look at iTunes, the vast majority of songs haven't been purchased by anyone -- it's driven by hits. We see 80 percent of our whole catalog listened to,” said Ek.

Elsewhere in the interview, the streaming music duo acknowledged they have around 10 million US Spotify users. Nearly 3 million of these are paid subscribers, giving them unlimited access to their music on their desktops and mobile phones. The two also said they are working hard to continually build their catalog and subscriber base.

“We're up to 18 million songs, growing at 10,000 or 20,000 songs per day -- it's very much a growing catalog,” said Ek.

Ek and Parker also mentioned they are more focused on singles and playlists as opposed to albums. The two look straight at Apple and the iTunes store as the origin of this behavioral trend, saying the birth of iTunes was the death of the collective album.

"The playlist is now the CD. It used to be a few songs were wanted by the consumer, and the rest of it was garbage. It's the new mix-tape, but accelerated on a massive scale,” said Parker. Spotify also sells “bundles”–or playlists–in Europe. When asked why these bundles aren´t sold in the States, Parker said, “They're coming soon.”

Finally, not missing his chance to get one last shot in at Apple, Parker called Apple´s weak attempt at social, Ping, as “an utter failure,” a sentiment which Tim Cook seemingly agreed with during his time in the Red Chairs on Tuesday. The All Things D Conference comes to a close today.