Spotify is regarded as the successful audio subscription service worldwide, and is developing fast, however, there is a question over whether this rise can carry on. It possesses 3 million paying customers up from 1 million in March 2011, and is also the marketplace leader in a fast-growing sector. But it’s beset by critique.

Three of the most popular albums of 2011, by Adele, Coldplay and also the Black Keys, usually are not available on Spotify or its streaming rivals. The reason being that of concern from the artists’ management that streams will cannibalise their current sales on iTunes. “Spotify competes with download stores,” says Coldplay’s manager, Dave Holmes.

Spotify is plainly still attempting to convert users in the free, ad-supported model to purchasing the service. Over 20% of its active users purchase the service and, helped with that, Spotify has paid $150m in royalties to music labels and publishers.

Nevertheless, the problem is that $150m isn’t a lot when divided up among all the recording artists on its support. A number of smaller, independent artists also have criticised Spotify because of its perceived low payouts. Mercury prize-nominated Jon Hopkins caused a stir in November, for instance, with a tweet claiming he had been paid out just for 90,000 plays of his songs in Spotify.

The organization is battling back. Ken Parks, its chief content officer, states that there is “not a particle of evidence that there’s any cannibalistic effect” on iTunes sales. Actually, he implies that the album holdouts are damaging. “They are punishing the people they have to embrace: the 18- to 24-year-olds, who have been previously paying hardly any or nothing at all.”

Even now, the danger for Spotify is the fact that more high-profile artists will appear at the sales of the albums which were not available to stream a year ago., Particularly,see cause and effect: they sold very well simply because were not on Spotify. A domino effect of album holdouts would hamper the business’s drive to register more paying subscribers this year and beyond.

Spotify’s latest apps platform can help. Inspired by Facebook, it allows developers to create applications living within Spotify’s own desktop software, building additional features on top of its streaming music catalogue. Parks thinks artists will begin launching their own Spotify apps this year.

Spotify also views its close relationship with Facebook as vital. Users who link their Spotify and Facebook accounts are 3 times more prone to become paying subscribers and the organization implies that artists who keep their albums off Spotify are passing up on the viral buzz.

However, Adele, Coldplay yet others are still benefiting, his or her older albums can be found on Spotify and its particular rivals. In six months’ time, it might be surprising if 21 and Mylo Xyloto weren’t added too. Nevertheless, more predominant adoption of “windowing” ┬ĘC where new albums are sold on iTunes months before they are offered to stream legally couldn’t survive great news for Spotify.

“Users are likely to stream: you’re not likely to put the genie into the bottle,” says Parks. “But if we will take people who weren’t paying anything and get them to pay 120 annually , which can be twice the quantity of the average downloader or CD buyer. This industry can grow larger than it has ever been.”