Daniel Ek wants labels to abandon per-play fees for streaming music.
Spotify co-founder Daniel Ek has called for reforms in the way the music industry charges streaming music companies for every song played by their users.
"The industry needs to think outside of the box and realise that the new business model in music is a mix between ad-supported music, downloads, subscriptions, merchandising and ticketing where the user comes first and where the key to monetisation comes from portability and packaging access rights," he writes in a blog post.
"I believe this is something that most people in the industry can agree to, but it can’t happen if the industry continues to enforce the per-play fees it has tried so hard to hold on to. The new model is about figuring out how to increase the revenue per user (RPU) between the different models - not squeeze as much as possible out of every single transaction."
Spotify has started to face questions recently about the sustainability of its business model - whether it can make enough money from advertising and subscriptions to cover its music licensing costs.
The recent launch of Spotify's mobile apps for iPhone and Android are part of its drive to convert more free users into paying subscribers.
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In the blog post, Ek says the company now has "hundreds of thousands of paying users", and that its advertising revenues "have now passed the millions of Euros per month mark".
He also hints at more mobile ambitions in the future, saying that Spotify is focused on "significantly improving our portability", as well as better library handling, more social features, and making it easier for users to buy music.
