Online music company Spotify announced that it now has 1 million paid subscribers for its services across Europe.
Spotify is in the middle of a fund raising exercise before launching its operations in the US and the news marks a milestone for the company’s performance.
The Anglo-Swedish company has a total of 6.67 million subscribers, most of whom avails the free service, supported by advertisements.
Subscribers who switch to paid premium service can use the service on their smartphones and the adverts are removed.
“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”, the company said in its online blog.
“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”, the blog said.
Spotify is trying to raise $100 million which tentatively values the company at about $1 billion (£616 million).
The company’s US launch has been delayed over fear of its bigger competitors and the sustainability of the company’s business model.
It was estimated last year that 7-8% of Spotify’s customers pay for the services. The company pays royalty every time a song is played on its site.
Daniel EK – chief executive of Spotify, told Financial Times at an interview that with the paid subscriber base touching the one million mark, premium subscription base has improved to around 15% of total customer base.