Streaming music service Spotify now has 10m paying subscribers and 40m monthly active users, the company announced today.
It's the first time Spotify has updated its public stats since March 2013, when the company had 24m active users and 6m paying subscribers.
“We've had an amazing year, growing from 20 markets to 56 as people from around the world embrace streaming music,” said chief executive Daniel Ek in a statement.
“10 million subscribers is an important milestone for both Spotify and the entire music industry. We’re widening our lead in the digital music space and will continue to focus on getting everyone in the world to listen to more music."
Spotify also announced that its users have created 1.5bn music playlists; that Avicii's Wake Me Up is its most-streamed song with 235m plays; and that David Guetta is its most-followed artist, with 5m fans subscribed to his updates on the service.
Spotify’s rivals in the streaming music market include Deezer, which has 12m active users and 5m paying subscribers, and Rhapsody, which has 1.7m paying subscribers around the world, split between its Rhapsody and Napster brands.
Other direct rivals include Rdio, Google Play All Access, Microsoft's Xbox Music, Sony's Music Unlimited and Rara, although none of these companies have released their active-user and subscriber figures recently.
In the US, there is also Beats Music, which launched in January and according to recent reports is being acquired by Apple for $3.2bn, in a deal thought to also include its parent company Beats Electronics. Apple's streaming music ambitions represent one of the biggest challenges to Spotify.
Its iTunes Radio service – which streams personalised "stations" rather than offering fully on-demand music like Spotify – is already available in the US and Australia with more countries expected to follow later this year, including the UK.
Meanwhile, YouTube is also expected to launch a subscription music service in the near future, although it's already the biggest online source of free streaming music.
Buying Beats Music would pitch Apple into direct competition with Spotify, although the latter has already taken a few public potshots at iTunes. "It is so obvious that Spotify is much better," Ek told The Hollywood Reporter in January.
"Some of our partners are saying Spotify is now generating more revenue each month across Continental Europe than iTunes," added Spotify's head of label relations Kevin Brown in April.
However, that same month Apple said it has 800m registered iTunes accounts – "most of these with credit cards" CEO Tim Cook told analysts – which could be the target for an aggressive marketing push for Beats Music if the rumoured acquisition goes through.
Spotify has grown fast: it launched in 2008 but didn’t reach 1m paying subscribers until March 2011. It passed the 2m milestone in September that year, 3m in January 2012, 4m that July, 5m that December and then 6m in March 2013. Spotify has thus doubled its paying subscribers since December 2013, adding around 290,000 new subscribers a month over that period.
Spotify says it has paid more than $1bn in royalties to music rightsholders since its launch in 2008, with half of those payouts coming in 2013 alone. Streaming music is an expensive business though: in 2012, Spotify's revenues increased by 128% to €434.7m (£377.9m), but its losses increased from €45.4m in 2011 to €58.7m in 2012.
Spotify has raised $537.8m of funding so far, including a $250m round in November 2013 valuing the company at $4bn. In March this year, Spotify was reported to be in talks with investment banks about a possible stock market flotation in the autumn.
Music industry body the IFPI said earlier this year that subscription streaming services generated more than $1bn of revenues for the industry in 2013, with more than 28m people paying for a streaming service that year – up from 20m in 2012 and 8m in 2010.
British music fans spent £103m on streaming music subscriptions and doubled their number of songs streamed to 7.4bn in 2013, according to industry body the BPI. In some countries, streaming has become the biggest source of industry revenues for recorded music: in Sweden, it accounted for 70% of sales in 2013, while in Norway it reached 65.3%.
However, streaming remains a controversial topic for some musicians, who have criticised Spotify – and sometimes its label partners – for the size of its payouts and a lack of transparency over how they are passed on to artists and songwriters.
Thom Yorke described the company as “the last desperate dart of a dying corpse” last year – the dying corpse being the music industry – while David Byrne suggested that "if artists have to rely almost exclusively on the income from these services, they'll be out of work within a year".
As Spotify grows, it hopes to persuade those artists and their managers that such "windowing" strategies will be counter-productive. The company launched a Spotify Artists website in December 2013 to explain how it calculates its royalties, and outline its goal of reaching 40m paying subscribers in the future.
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