Spotify has been a revelation since it launched late last year. The innovative ad-supported music service allows users to access and play full-length tracks for free.

Alternatively, there’s the option of paying a small monthly fee to sign up to the premium version in order to remove the ads and access the mobile version. 

All in all it’s a fine playground for anybody who loves music. I caught up with Spotify CEO Daniel Ek, who talks about the company’s progress and plans…

So how are things progressing at Spotify? 

Progress is very good, thanks. We recently celebrated Spotify’s one-year anniversary since launch and we’ve made a lot of progress but we also still have a long way to go and a lot of work ahead of us.

Can you give us a rundown of the latest facts and figures? 

Currently we have over 2.5 million users in the UK, in total we have more than 6 million registered users. We haven’t released any engagement stats as of yet. 

What’s the split between free and paid accounts, and are you on target for subscriptions?

The large majority of users are on the free version. We always knew this would be the case but we’ve seen significant growth in premium subscribers as we added new features such as mobile, CD quality streaming and offline use. 

Did you imagine that Spotify would grow so quickly? 

We were confident that we had a high quality service – we’d spent two years working very hard to ensure that was the case – but we were surprised and extremely flattered at just how well users responded. The response shows just how much hunger there is for a quality, legal music streaming service.

How are you coping in terms of scale? What kind of technical / business challenges arise as a result of scale?

Growing into a multi-million users service is always a challenge internally and externally but we’ve done a good job so far and we’re confident we can continue to scale. 

When do you hope to roll out Spotify in the US, and other markets? Is it simply about working out deals with the record labels?

We’re looking to launch in the US in early 2010 and we’re continually investigating other markets that we could enter. 

Record label agreements are one of the main issues with regards to the launch but there are also technical and business considerations to consider before we go into a new market.

I’ve signed up to the paid service and now use Spotify every day. Since I joined I haven’t bought very much from iTunes. Does access beat ownership?

That’s great to hear! We think that for a larger segment of users, access to music is more important than ownership. But there is room in the market for a number of different models – including ownership – which is why we’ve recently improved our ‘Purchases‘ feature to allow those who want to buy music the ability to do so easily within Spotify. It’s all about giving user fans a wider choice. 

How are your mobile plans progressing?

We have Spotify available on both the iPhone and Android platforms and have announced development of Spotify for the s60 mobile OS. We’re also looking at other mobile platforms so that we can provide as many users as possible with the ability to take Spotify on the move with them. 

I feel that there’s terrific scope for personalisation and user collaboration on Spotify, particularly on the homepage, and also for tagging / groups. Are there plans to roll out these kinds of features? What would you like to see happen?

There are still a whole host of improvements we plan to make – recommendations, user collaboration and social aspects are definitely high on the list. We have a lot of exciting things being worked on right now. 

Would you say the opportunities presented by digital channels are outweighed by the difficulty in promotion / raising awareness due to fragmentation?

Not at all. I think digital channels provide artists with an opportunity that they’ve never had before to reach fans. Previously only a small percentage of artists could reach large audiences but with services such as ours, all you need is good music to reach millions.

Some of my favourite artists aren’t yet on Spotify (Ariel Pink, Cardiacs, John Maus). What’s the process here? 

We’re always working to add new music. Right now we’re adding about 10,000 new tracks to Spotify every day. We’re also continually working to sign new deals with content providers so that we can expand our catalogue and we’ll keep working at it to ensure that your favourite artists are added.

Do you think Spotify will become a content aggregator and distributor of music (and possibly other forms of media), as opposed to a pure access service?

We don’t have any plans to aggregate or distribute ourselves at the moment. We have a lot of great partners like Merlin, CD Baby and Record Union that do a great job already and we’ll continue to work closely with them.

What did you make of BPI chief Geoff Taylor’s comments about wishing the industry had worked with Napster?

It’s encouraging to see comments like that and we want to continue working with the industry to find ways to combat piracy. 

Why is Spotify CTO Anderas Ehn leaving and when will he be replaced?

Andreas left to pursue new challenges. We’d like to thank Andreas for all his brilliant work in helping mould Spotify into the music service it is today. Everybody at Spotify wishes him well in the future as he seeks out new and, no doubt, extraordinarily complex challenges. We’ll be introducing our new CTO soon.