For those of you who are unaware, Spotify is a service that offers a legal solution to music access. Through an application, Spotify will provide you streaming access to almost every catalogue in the world, either for free (with advertising) or for a monthly subscription (Ad-free). The question that now remains is whether the key demographic (18-34) will adopt this service.

Spotify is currently reported to have customers between the ages of 30 to 50 who apparently use spotify to rediscover old music rather than discover new music. The younger age groups on the other hand are what Spotify will be really interested in. Unfortunately, this group will want its music on the go…which means that Apple’s approval of the Spotify iPhone app will play a critical part in the growth of this model. But will Apple be ready to kill the iTunes model by approving the Spotify application? Further, in countries like Canada where the monthly limit on iPhone/Blackberry internet usage is quite limited and highly expensive, this streaming model may not easily catch up.

In my opinion, Spotify currently functions as a source of music access that precedes the download of an album through a p2p network. So, this poses 2 key hurdles that Spotify needs to overcome -

First, make consumers overcome their need to own their music.

Second, when consumers do want to own their music, make them pay for it  (hmm).