Cheap...

@Rob Kendrick:

Expensive, compared to what? Downloading albums illegally? Sure.

If, on the other hand, you want to listen to a whole host of new-release albums without having to shell out £7 a time to find out if they're any good, it makes its money back every single week.

Ironically, your TV license example is a good idea of exactly why Spotify works. How much TV would people actually watch if you had to pay per programme that you wanted to watch? Sure, there'd be some (infrequent TV watchers) who might find it beneficial ("£10 a month to watch TV? Bugger off") but an all-encompassing licence to watch everything on terrestrial telly is much preferable, shirley?

But, to bring the post back to its beginning, it's pretty hard to convince people to switch to a subscription model when they're already used to ripping all their music for free.

+data

The fact that this is £10 on top of data costs ("unlimited"!) makes this a pricey service. Then factor in that you can't keep anything after you cancel. £5 would be the sweet spot for me.

@Studley

It's Expensive compared to other products that do the same thing.

Napster does it for £5/month, and it has an iphone client.

Sky Songs is £6.49/month AND you can download 10 songs a month for free.

Your right, spotify is more expensive than stealing, but it's also more expensive than most of it's rivals.

Like i said earlier, it's the mobile clients that make the difference.