Apple Music rival Spotify on verge of turning a profit, board member says

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Spotify, the world's biggest on-demand music service, could finally turn a profit in 2017, one of its board members said on Thursday.

"Up until now, I think it's been growth, growth growth," Par-Jorgen Parson told Reuters. Parson is a general partner with venture capital firm Northzone, and one of Spotify's first investors. Asked whether Spotify could turn a profit next year, he said it was "absolutely" the case.

Spotify now has a presence in 60 markets, and over 40 million paid subscribers, plus an even larger contingent of people listening on its free ad-based tier. To date though it has posted a loss in every quarter, pumping money into expansion and/or the music licenses it needs to offer content. The company doesn't generate much money from ad-based listeners, and regularly encourages them to upgrade.

While Apple Music has far fewer subscribers — somewhere north of 17 million in total — it's thought to be doing well financially. Even if it weren't, Apple isn't dependent on its success, and is likely using the service as a way of keeping people attached to its hardware and software platforms.

Apple is rumored to be considering a temporary 20 percent price cut on its individual and family subscriptions. If so that could dramatically undercut Spotify, which doesn't have any alternate sources of revenue to fall back on.