January 20, 2011 at 8:50 am

Spotify Inks First U.S. Label Deal with Sony

Well, it finally happened: Spotify has reportedly inked a deal with Sony Music Entertainment to start offering its wildly-popular freemium music subscription in the United States for the first time.

After years of anticipation and months of strong hinting, news that the Swedish music service convinced at least one major label to sign on to its music service, which allows users to listen to up to 20 hours of just about any music they can think of per month and creating shared playlists with their friends, all without paying a single cent, was broken by All Things Digital.

A source close to Spotify told me months ago that Sony was close to signing this deal; early last year, it rolled out free listening limits in a transparent attempt to make its service more label-friendly in the states; and the company bought server space here and started hiring New York-based ad sales reps last year. So this news wouldn’t have come as a surprise, were it not for Spotify’s well-earned reputation for promising to launch in the states and failing to deliver.

This Sony deal, which All Things Digital’s Peter Kafka says was verified by multiple sources (neither Sony nor Spotify would comment on the record), does not ensure that Spotify will launch here by the end of the year, or indeed, at any other time. But it’s the first truly solid indication that Spotify really does plan to give U.S. music fans a powerful new listening option on multiple app platforms – smartphones and computers first, then televisions and cars – and that the major labels might be willing to offer the company sustainable licensing rates as it does so.

So, why was Sony the first of the four major labels to license its music to Spotify for a United States-based music service? We can’t help but notice that it’s the only one of the four that sells consumer electronics equipment. Sony’s recently-enlightened vision for connected entertainment services across computers, televisions and portable devices depends on services such as the much-loved Spotify, which allow the same user to access the same account on a wide variety of devices. This surely likely the only factor, but out of the four major labels, only Sony stands to sell more hardware if Spotify and other unlimited music services take off.

Spotify runs for free on Mac and Windows desktops and laptops. In order to use the iPhone or Android mobile app — which includes the ability to cache songs for playback without using your phone’s data connection (up to 3,333 on the iPhone) — you’d need to subscribe. A full, mobile-enabled subscription to Spotify will likely cost $10 per month, which is the going rate stateside.

All Things Digital reports that free version of the U.S.-based Spotify will offer the same 20 hours of free listening per month that its European cousin does. Without that free version, which is relatively unlimited compared to the time limitations of MOG, Rhapsody and other U.S.-based music subscriptions, Spotify would lose much of its allure. Assuming the remaining three majors (EMI, Warner and Universal) as well as the big independent music aggregators (The Orchard, Merlin, IODA, Iris, CD Baby, etc.) fall into line, this Sony deal is good news for Spotify – and potentially for music fans, too.