Probably the fact that Spain is the country with more downloads per internet user in Europe made Spain the first EU country to get Netflix. When I recently met with Presidential hopeful Alfredo Rubalcaba he spoke about how much pressure the Spanish government received to stop the downloading of US content without pay in Spain and was very aware of how Spotify was making it in Spain as a legal alternative.

Now the challenge will be to see if it was true that people downloaded because DVDs are a rip off or because they don’t want to pay any price for movies. Because Spotify really took off in Spain but only the ad based version. Few pay. And there is no ad version of Netflix. Only on Hulu there is. But to me Netflix is an incredible deal. To pay less than €10 per month for all you can eat quality streamed movies is unbelievable.

I pay for Spotify and for Netflix. Netflix I had to sign up through our home in NYC and use it with VPN service Witopia that makes me show up as a US client.

I love Spotify on my mobile!

I have been using both Spotify and Rdio for quite some time now. Following the recent rumors that Spotify will launch in the U.S. this year, I felt like writing a detailed comparison between the two products based on my experience so far.

While broadly speaking the business model is the same, my impression is that the general approach of both companies is quite different (I am friends with the founders of both companies and a small investor in Rdio but I hope this does not affect the objectivity of my post).  Rdio seems to have built a music streaming service around a social networking core. Spotify’s core is music streaming, offering social features on top. You notice the difference at once when you log into the desktop application. Spotify’s home screen shows you new releases and a news feed that combines information from Spotify with activity in Facebook. On the left side you can immediately access your playlists and start listening. Log in to Rdio on the other hand, and almost everything you see is based on the activity of your social network in Rdio. You see the songs that have the most “heavy rotation” in your network, you have a feed of recent activities of your network and you see the artists that are most popular among your network. What Rdio tries to do is create your own music listening community very much like Runkeeper creates your sports community.

In general, Rdio has a much more social graph feel than Spotify. You can follow friends and other people Twitter-style, find friends with whom you are connected on existing networks (like Facebook, Twitter, Gmail, etc.), get recommendations for people and influencers to follow and find out more about your own followers or the network of people you are following. It’s also possible to see which users have been listening to specific artists, albums or even songs. And you can write your own reviews on an album and artist level. You can also see how often a specific song has been played, and you can browse through other people’s libraries or playlists based on certain songs/artists/albums they have in their collection. Rdio’s charts also integrate some of these features and feel more complete than Spotify’s. All of this is really great for discovering new music provided that you actually have a network of friends in Rdio which is what so far is lacking because of the relatively small size of the community compared to Spotify.  Now this is the case in the countries in which Spotify is active. But in USA Rdio has an advantage over Spotify which has not launched there yet.

Spotify is much more like iTunes.  From the above list of features, Spotify only supports Facebook integration and users can only subscribe to individual playlists, but they cannot follow other users like as they can with Rdio. I read somewhere that Spotify is much more “track-oriented” than Rdio, and I agree. Your search results consist of a long list of individual tracks, also if you search for an artist. Rdio arranges search results into four categories: artists, albums, songs and playlists, and people. This is neat, but also more time-consuming if you know what you’re looking for and just want music to start playing right away. Spotify is much more no-frills, but more intuitive and way faster.

In terms of speed I found Rdio to be rather slow and unresponsive. It’s possible that this happens to me because I am in Europe, where Rdio is officially not yet available. But for whatever reason this interferes with the music listening experience. On average, it took about 5-10 seconds for a song to start streaming. This also happened when navigating through the desktop app, which uses Adobe Air and is web-based. Spotify’s proprietary P2P software is a huge difference. Everything is basically instant, there is no noticeable delay between the time you click on a song and it actually starts playing (when streaming). Also scrolling through a song feels like having it on your hard drive.

Check out this detailed comparison between the iOS apps of Rdio and Spotify. I prefer Spotify, but as with most things this boils down to a matter of taste. If you have Shazam on your iPhone or Android, you can now also play found songs directly by hitting the “play with Spotify” button.

What’s really cool and useful is that Spotify now allows you to manage your iPod directly (but not the iPod touch), bypassing iTunes entirely. And even users of the free app (see the embedded spreadsheet below) can now use the mobile apps, but only with tracks they actually own (no streaming).

Importing your existing tracks is a huge advantage of Spotify: you can add your own tracks to the player, even if they are not in the Spotify catalogue. As mentioned above, you can then sync them easily to your mobile device (over the cloud) and listen to them anywhere, also being offline. Spotify supports many different music formats and can also complete missing track information automatically, due to a partnership with Gracenote. Rdio can only match your iTunes collection, and if they don’t have the rights for a song you can’t listen to it with Rdio.

Spotify wants to replace all your existing music players. And for me, it does. I can have all my music in one place, everything is synced over the cloud with any device I might use, and it’s super easy. In addition, the audio quality of Spotify is great, especially if you have subscribed to the Premium service (up to 320kbps). There have been some complaints about Rdio’s audio quality, but I didn’t experience any problems in this regard. Another advantage of Spotify’s longer existence and large following are the many web goodies, which are resources/apps built around Spotify, like playlist sharing sites, remote control apps, music discovery, etc.

Conclusion: so far Spotify is clearly the better product. It has all the features you need, is super easy to use and very fast (no delay in streaming songs) and it can really replace your existing music players. You can import all your music files, even those that are not in the Spotify catalogue, and sync them to your mobile devices.

Maybe Rdio is simply overloaded with too many features that are nice to have, but not essential. Of course they will be more relevant as Rdio’s popularity increases and more of your peers start using the service. But for the time being you have everything you need in Spotify, and it’s super simple to understand and use. Considering the comparably late launch of Rdio, they nevertheless have achieved a lot. But Spotify is still better, at least for me. Another example of why simplicity wins.

Two thing’s I’d like to see in the future for both Rdio and Spotify are an equalizer (doesn’t have to be the full-blown thing, but it should include some presets) and of course a native iPad app.

Lastly I would like to say that Janus Friis is an amazing designer, the man behind Skype and a mighty rival for Daniel Ek, so while Spotify is the winner at this stage this could be a long tennis match with a different result in the next set to be played in USA.

Thanks Merten Wulfert for his help on this post.

Here’s a comparative spreadsheet which complements my post:

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Microsoft Zune HD portable media player
Image via Wikipedia

Why is Spotify so good? Because it starts from iTunes and improves it. It is like Apple, but better (except that is not yet available in USA). Why is the Zune a bad experience? Because it is not at all like iTunes. Like it or not Apple is the standard in music. Just as the whole world has been educated to use Windows, and a few to use Mac and Linux, in music, the whole world is educated to use iTunes, and a few to experiment with the alternatives. So Spotify built a great platform that is intuitive to use. It is like iTunes, but the songs are free and the Genius is your friends. Huge success. But Zune is just…. obscure. I try most WiFi gadgets, and this afternoon I spent a couple of hours trying a Zune out. My rating is 2 stars (sorry to use Apple again). The Zune is beautiful as a device, the graphics are attractive, original, but it is incredibly slow to load songs, the monthly costs at $15 are out of the market, and using the Zune software which is, not surprisingly, only available for Windows, is too complicated. I guess Microsoft has a hard time admitting that if you enter the music field you have to be like iTunes but better, which also means to start looking kind of like iTunes. It is hard for people to learn another language. Apple should know that, they have a better product than Microsoft Windows in OSX and market share gains are slow mainly because people are afraid to change. If I had anything to do with Zune, I would leave the gadget as it is and would do a new version of the software that is more intuitive, more like iTunes, that allows you to import your lists from iTunes, that basically clones iTunes as Doubletwist does. Or wait! Maybe Microsoft should buy Doubletwist and make it work with the Zune.

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Image representing Spotify as depicted in Crun...
Image via CrunchBase

In 2007, I met fellow serial entrepreneur Daniel Ek and was very impressed with him and Spotify, his new music service. I blogged about it, calling it the Joost for music. Unfortunately, since then, Joost has faded away and as a small investor in the company I lost some money. But the concept of Joost lives on in Hulu. I should have called Spotify the Hulu of music, but in 2007 Hulu was not around yet. And, in any case, Spotify is so famous now that people are calling the all-you-can-eat, $10 per month, streaming service of Netflix the Spotify of movies. And we are all waiting for Spotify to launch its own movies service.

Two years later, in January of 2009, I blogged that Spotify was coming to Spain. The response was great. Many readers asked me for invites. Spain took off nicely for Spotify, becoming an over represented country in the Spotify community. This I found very interesting because over here music downloads are legal, nobody needs to pay for music, and yet, Spotify has done super well. Indeed Spotify in Spain thrived despite competing with free.  That people would either pay or put up with advertising is just another proof of how great Spotify service is. Or most people I should say, because until today I was not one of them. Even though I pay for and for Grooveshark, I could not get myself to pay three times as much for Spotify Premium. And because I hate commercials I was not using the free Spotify. Instead I had in my Sonos, Grooveshark in my Android phone and in my Blackberry, and both services in my computers. These service are around $30 per year instead of around $150. So I became this unusual person in Spain who first promoted the hell out of Spotify and then failed to use it. It would have helped had Daniel gave me a free premium account, but I guess he is as cheap as I am, and did not volunteer. 🙂

So, no Spotify for me, until today. Today Spotify introduced a €5 per month service that is not as good as the premium, but good enough for me to join. It does not allow you offline playing nor mobile playing, but it gives you all the songs you want for less than I used to spend in a week on music when I was in college and used to raid Tower Records, spending $100 or more per visit. Now Spotify costs twice as much as or Grooveshark, but not 5 times as much.

If you don’t have Spotify you are probably wondering what makes Spotify so great. Or why it’s the only web service in the world that Americans seem to be truly sad that they don’t have. Here’s a list of what it does:

It piggybacks on iTunes and makes all your iTunes music and lists available to you, even all the music you have without copyright (which is not a crime in Spain to download).

It blends incredibly well with Facebook. You sign up, connect with Facebook and have instant access to your friends’ iTunes and Spotify lists.

As opposed to and Pandora, you can play the song you want when you want it. This, btw, is where Spotify can lose their shirt because licenses for radio playing are much cheaper than song on demand licenses.

The quality of the music is great and the speed at which a new song that you asked for plays is remarkable.

On the negative it does frequently happen that you go to a friend’s list, want to play it, and you get a message that says “this track is currently not available in Spain”. The solution? If you are in Spain, go to Vuze, Limewire or simply to a friend, get the music, upload it, and then Spotify considers it your own and plays it off the list of your friend. But, Grooveshark for example, does the same thing for all your computers. Spotify, probably more closely watched by the rapidly vanishing music labels, actually check if you have the music in your library at that computer before it plays it for you. This forces you to use Spotify from computers with huge hard drives to avoid the “not currently in Spain” label and that gives an advantage to Grooveshark. Especially on netbooks and mobile phones.

If you are willing to pay €10 per month, the offline and mobile playing should be great.

Lastly, I would like to say that I think the two best user experience entrepreneurs in Europe are Janus Friis and Daniel Ek. They both went into crowded fields: VOIP/Chat and music players, and outdid everyone else.

What else?

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