Spotify has announced today that they have reached the point of one million simultaneous customers. This is huge. The company launched its service just some two years ago and they now have million simultaneous customers and over 10 million registered users altogether. However, Peter Kafka from AllThingsD states that Spotify has some 7 million active users in its service, yielding a whopping 15% conversion rate for their service.
The company has been recognised for its difficulties in entering the US market, usually on the other side of the pond, but very few realise the size of business Spotify has built over on the old continent. Last month we broke the news that Spotify is the second largest source of revenue in Europe for record labels in digital music. Now with only really available in a handful of European markets, the company has reached 1 million paying customers.
With very basic calculations (fee of $10 a month), this makes Spotify over a $100 million business a year. Furthermore, this is all from subscriptions and it needs to be recognised that the company generates some revenue from ad sales as well.