Licensing restrictions hit Swedish online music service

The Sweden-based online music service Spotify, welcomed by many as a giant leap forward in the distribution of music online, has raised intellectual property rights concerns from several record labels.

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The music streaming service, developed by a pair of Swedish internet entrepreneurs, offers consumers unlimited listening to thousands of albums on their computers via the web.

Launched this week in Britain, Spotify allows anyone and requires listeners to either subscribe to a free advertisement-supported plan, pay 99 pence ($1.40) for 24 hours worth of ad-free music, or £10 for a month's worth.

While Spotify has been highly praised by various commentators -- The Guardian's music commentator describes it as being "so good you soon wonder how you lived without it" -- the music industry has not been as impressed.

On January 28, Spotify's global community manager Andres Sehr posted on the company's blog that it had been forced to remove an unspecified number of tracks, thousands according to The Guardian, because of licensing restrictions.

"These restrictions are a legacy from when most music was sold on tapes and CDs and they have continued over into streaming music, our hope is that one day restrictions like this will disappear for good," Sehr wrote.

"Our dream is to create a music experience where users can play whatever music they want, whenever they want. It may take a while but we will keep working at it."

Spotify was founded in 2006 by Swedish entrepreneurs Daniel Ek and Martin Lorentzon, who ploughed more than €8 million ($10.3 million) into the service themselves, The Guardian said.

Using the service involves downloading a small software package for installation on a listener's computer, similar in appearance to Apple's iTunes music player, and allows users to compile "collaborative" playlists that can be shared between friends.

Despite its current intellectual property issues, Guardian music columnist Chris Salmon suggested Spotify could be on course to become another giant of the Internet.

"Google is an example ... YouTube another. Spend a little time with Spotify and you could well be adding it to the list," he wrote.