Spotify CEO: We will take on the US

The CEO of internet music provider Spotify says he is locked in negotiations with record companies to bring the music-streaming service to the US. Daniel Ek claims the free-to-use application will be rolled out there later this year, once the "details" are agreed – though some music industry insiders remain sceptical.

Spotify allows users to choose from a library of eight million tracks and comes in two versions – a free one with advertising, or a £9.99-a-month edition without. There are a quarter of a million subscribers, with just five per cent of those choosing to pay.

At the moment, the service can only be accessed by internet users in Scandinavia, France, Spain and the UK. Ek had hoped to roll out in the US at the beginning of this year, but now admits he had overestimated the willingness of American music publishers to work with him.

Speaking this week at the South By Southwest festival (SXSW) in Austin, Texas, Ek said his company was bogged down in detailed negotiations. "This is a very, very complex industry," Ek said. "It's an industry that's been in decline for 10 years. They just want to make the right bet."

Spotify was recently valued at $200m – and Ek told the Times last month he expects it to be worth "tens of billions" in "a few years". But the hyper-confident 27-year-old Swede says he will "never be interested in selling". He set up his first company at the age of 14, and came up with the idea for Spotify in 2002 when Napster was banned.

Napster, the controversial file-sharing site, was allowing users to swap music with each other for free. As soon as it was outlawed, Ek noticed, it was replaced by another almost identical system, with a different name, written by a different computer nerd.

Ek says he realised at that point that "you can never legislate away from piracy". He explains: "The only way to solve the problem was to create a service that was better than piracy and at the same time compensates the music industry – that gave us Spotify."

Ek admits his application does not generate record labels as much income as pay-per-download services such as iTunes – and some US music industry figures have been dismissive of the whole concept. Edgar Bronfman Jr, CEO of Warners' music arm, told the Los Angeles Times recently: "This, sort of, 'get all the music you want for free and then maybe we can... move you to a premium price' strategy is not the kind of approach to business that we will be supporting in the future." The fact Ek hales from the country responsible for the Pirate Bay, a website that facilitates the free, illegal downloading of music, probably doesn't help.

But Ek remains bullish about his chances of winning over the US labels, maintaining it is a case of 'when' not 'if'. "We've always said we wanted to launch in early 2010. We still hope that will be the case," he said at SXSW. "That said, I don't think it matters for us if it's two or three months later. The US is the world's biggest market. And to use an American phrase, we really want to hit it out of the park." ·