Spotify hits milestone with 1 million subscribers

Spotify hits milestone with 1 million subscribers
Spotify's co-founders Spotify's founders Martin Lorentzon (left) and Daniel Ek are in the middle of a $100m fund-raising
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Online music service Spotify has announced that it now has one million paying subscribers across Europe.

News of the milestone comes as Spotify continues a fund-raising from investors in advance of a launch in the US.

The Anglo-Swedish company has 6.67 million users, the majority of whom use a free service subsidised by adverts.

Spotify's profitability depends on users switching to premium services that remove adverts and allow listeners to use smartphones.

The company announced on its website's blog: "It seems like only yesterday we were hatching ideas for a new music service in a tiny office-cum-apartment with a broken coffee machine.

"So it's with a sense of real pride and excitement that we can announce a new milestone today, having welcomed our millionth paying subscriber to the service. "

Spotify is in the process of a $100m funding round that analysts estimate values the company at $1bn (£616m).

The company's plans to launch in the US have been delayed by concerns at the big music labels about the success of its business model.

Spotify pays royalties each time a song is played on its service.

Last year, it was estimated that the subscriber base represented about 7%-8% of Spotify's total user base.

But with one million subscribers, that percentage has risen to about 15%, the company said.
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