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SpotifyIs Spotify’s Business Model Broken? (CNET)
Spotify’s financial performance in 2011 was abysmal. As revenue increased 151 percent from 2010, the on-demand streaming music service saw losses widen 60 percent for the same period, according to documents posted by PrivCo, a company that sells data on non-publicly traded companies. BetaBeat Virtually every new dollar of revenue went directly to music companies as royalty payments, evidencing the fact that the more members Spotify adds, the more money the company loses. This is a clear indication that the online licensing fee/royalty model is increasingly restricting Spotify’s ability to generate sustainable margins using its freemium model. The Next Web Spotify’s 311 employees grew salary costs 173 percent year-over-year in 2011, outpacing revenue growth, according to PrivCo. Business Insider Unlike Groupon, Spotify can’t just trim its marketing spend to cut its losses. It either has to completely change its business strategy, or get much better at its business. TechCrunch In related news, Warner Music Group’s owner Access Industries and previous investor Idinvest are investing $130 million into music streaming startup Deezer. Even though the company is doing well in its country of origin, France, it is still at the very beginning of its international expansion. Read more

NY Judge Allows Startup to Relay Live TV to iPhones, iPads. Will Second Screen Ratings Help Networks?

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It’s not illegal to watch live content from television networks on a mobile device, a New York judge ruled on Wednesday. Television networks Fox, ABC, CBS, and NBC and others had sued the startup company Aereo for copyright infringements after learning that the company was using remote antennas to give viewers access to their content on iPhones, iPads, and computers for $12 per month.

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Will Facebook’s Timeline Last? A Closer Look at 7 Other Facebook Features from 2011

Facebook for iPhone app in 1x mode on an iPad.

Facebook users are afraid of change, according to a USA Tod ay poll released in mid-October, which revealed that 56% of Facebook users did not like Facebook’s latest changes. With that being said, Facebook users are constantly growing by the day. What keeps current users with the social networking platform, and what drives new users towards it? The answers are endless, but we should not be looking at what brings users to the platform, instead we should be looking at what drives users away. Timeline, Facebook’s “new kind of profile,” could be the underlying answer to the question at hand.

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Android Faces Lawsuit For Knowing Too Much About The Users

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Google’s Android smartphone has become a Big Brother and knows more about the users, than their family and friends does. A federal class-action lawsuit filed by a Charleston attorney, has alleged Google and Android phone apps of keeping track of user’s personal information and selling them to advertising companies. According to the lawsuit, Android apps keep track of customer’s personal information ranging from his physical location, to his sexual orientation and monthly income.

Aaron Mayer, the lawyer who filed the suit is representing three men, two from Texas and one from Florida. Mayer’s client learned form an article in Wall Street Journal that their phones could collect and sell their personal information. Mayer’s case is the first ever lawsuit nationally related to Android’s privacy concerns. Mayer said.

If you’re using a map application, then yeah, its going to get your location. If you’re using a map application and it’s also collecting your gender, your sexual preference and your income, users don’t think they’re consenting to that.

Mayer filed the case in Florida against Android’s owner, Google; Internet radio provider and Android app maker Pandora; and advertising companies AdMob and Traffic Marketplace. According the lawsuit, Google engineers the OS for different smartphone models to retrieve the user information from the phones back to the company’s databases. The smartphone apps gather information even when the users aren’t using their phones. Mayer also told that since the news of lawsuit outbreak, nearly 10 similar cases are filed around the country and all of those cases will eventually be consolidated into a single case in California. According to the lawsuit, 67 million Android based phones were shipped worldwide last year alone.

The lawsuit also alleges that Pandora collects location data and other information from phones and shares it directly with third parties. Officials with Pandora, Google and Ad Mob, has refused to comment on the pending litigation.  However, Traffic Marketplace has made a brief statement saying that the company “does not collect or buy any personal data or information pertaining to mobile devices”.

The lawsuit asks compensation for the price of the smartphones and the value of the data collected and shared with the advertisers, plus disciplinary damages. Imagine if Google and its partners lose this lawsuit and they are asked to compensate all the Android users. Even worse, imagine what is it that Google potentially does not know about you.

U.S. Sen. Al Franken, a Minnesota Democrat and chairman of the Senate Judiciary’s Subcommittee on Privacy, Technology and the Law, has asked via letter the CEOs of Google and Apple, for transparent privacy policies in the online marketplaces where customers buy apps. Franken wrote;

Although I believe there is a greater need for transparency and disclosure for the collection and sharing of all personal information, at a minimum, I ask that you require all location-aware applications in your app stores to provide privacy policies that clearly specify what kind of location information is gathered from users, how that information is used, and how it is shared with third parties.

According to Mayer the next six months are significant to determine the direction of the lawsuit. If the case shows any progress, other Android users would likely receive notice of the lawsuit.